Art Fairs - Are they profitable?

We’re only a few days away to Frieze London (October 9 - 13, 2024 in The Regent's Park) and since 20 years it has been one of the most popular, coveted, and advertised art fairs the UK and worldwide.

Since I’ve started visiting art fairs, and studying the slow, slightly stuck-up movements of the fauna that populates a typical day of these events I’ve always wondered how profitable a 4 day such event might be. For the artist and the gallery (and the event organiser too, but this is for another piece since this one will come off long enough).

What is an art fair?

If you’re here, you should have not only a grasp of what an art fair is but have probably attended a number of those: typically a hangar-like warehouse where artists, galleries, collectors, curators, and art enthusiasts gather to showcase, view, and purchase artworks, being these in the spectrum of visual arts, such paintings, sculptures, photography, and installations, from both emerging and established artists. There, this is it.

The reason why art fairs started to pop up as early as the Middle ages (it seems that Our Lady's Pand, in Antwerp, was the first book an art fair founded in 1460) is because a lot of money circulates around those. Art fairs serve as a marketplace for the art industry, facilitating the buying and selling of art, but they also play a cultural role by promoting new trends, fostering connections within the art community, and providing visibility for artists.

Some of the world’s most famous art fairs include Art Basel, Frieze, or The Armory Show.

Attending one of these is no vacation time for all of the parties involved. If you’re a gallery, there’s an application and selection process you need to go through, and, as much as the art fair organisers need to fill up the available real estate, not every application ends up being admitted.

How do art fairs actually work, what’s the process and the fees

The costs of applying and participating in an art fair can vary significantly, but generally, they include several key expenses. First, there is an application fee that ranges from £100 to £1,000, depending on the fair’s prestige and size. If accepted, galleries then face booth rental fees, which can range from £5,000 to over £100,000, with smaller regional fairs on the lower end and top-tier international fairs, such as Art Basel, on the higher end. Booth costs are often calculated by square footage, typically ranging from £300 to £1,000 per square meter.

In addition to these upfront costs, there are various additional expenses. Shipping and handling of artworks, particularly for international fairs, can cost between £10,000 and £50,000, depending on the volume and distance. Installation of the booth and artworks may add another £1,000 to £10,000. Travel and accommodation for gallery staff and artists, along with meals, typically cost anywhere from £2,000 to £20,000, depending on the fair’s location. Marketing and promotional materials might add £500 to £5,000 to the total cost. Insurance for both the artwork and the booth is also required, which usually costs between £500 and £5,000, depending on the value of the pieces.

In some cases, galleries might also need to factor in commissions on sales, although this is less common at high-end fairs. Some art advisors or agents may take a percentage of sales, typically between 5% and 10%. Overall, total participation costs for smaller fairs can range from £5,000 to £15,000, mid-tier fairs from £15,000 to £50,000, and high-end international fairs can exceed £150,000.

Cost break down for some of the most popular fairs

I wanted to make a real life example, imagining I’m part of one a mid-to-high tiered London gallery (say, Maddox), willing to partake into Frieze London 2024. For transparency, I haven;t asked them directly and these figures are purely exemplary.

For a major gallery like Maddox Gallery participating in Frieze London, the total cost might likely range from £75,000 to £150,000. This includes several expenses. First, they would pay an application fee of about £500 to £1,000. The booth rental is one of the largest expenses, costing between £50,000 and £100,000 depending on size and location within the fair. Since Maddox is based in London, shipping and handling costs for their artworks would likely be around £5,000 to £15,000.

Setting up the booth, including lighting and installation, could cost an additional £5,000 to £10,000. Travel and accommodation costs would be lower than for international galleries, possibly between £2,000 and £5,000, though they might spend more if bringing in external staff or artists. Marketing and promotional efforts, such as brochures and catalogs, would likely range from £2,000 to £10,000. Finally, ensuring both the booth and the high-value artworks on display could cost between £3,000 and £10,000. In total, these expenses would result in an estimated cost of £75,500 to £151,000 for Maddox Gallery to participate in Frieze London.

What’s the likelihood that the gallery will make a profit?

Following on with my example, the likelihood of Maddox Gallery making enough sales at Frieze London to turn a profit is fairly high, given several factors. First, the sales potential at Frieze is significant because the event attracts affluent collectors, curators, and investors who are prepared to spend large amounts on high-end artworks. A single sale of a major piece could easily cover a substantial portion, if not all, of the gallery’s costs. Maddox Gallery often deals in contemporary artworks priced between £50,000 and £500,000 or more, so just one or two successful sales could result in profits beyond their expenses.

Additionally, Maddox has a well-established reputation and a strong network of clients, many of whom are likely to attend Frieze. This existing client base increases their chances of securing sales during the event. Moreover, beyond immediate sales, participating in such a prestigious fair helps build long-term relationships with collectors, leading to future sales, exhibitions, and commissions.

While direct sales are important, the prestige and visibility gained from participating in Frieze London also add value. Even if Maddox doesn’t make enough sales at the fair itself to immediately cover costs, the exposure can significantly boost the gallery’s reputation and lead to sales afterward. The long-term benefits of visibility at a fair like Frieze can be invaluable in driving future business.

The broader contemporary art market has been strong in recent years, with many collectors viewing art as an investment. As a result, Frieze London is a prime opportunity for them to purchase artworks, making it likely that an established gallery like Maddox will secure sales.

There are risks involved, particularly with competition from other galleries at the fair. However, Maddox’s reputation gives them a competitive advantage. Sales are also subject to current trends in the art world, and if they present highly sought-after pieces, their chances of making substantial sales increase. Overall, while there is always some uncertainty, Maddox Gallery is well-positioned to turn a profit at Frieze London, either through immediate sales or through the long-term benefits of the exposure gained from participating in such a prestigious event.

But not all galleries have the means of  an internationally renowned, blue-chip brand.

In fact, there are about 1597 art galleries in London and about 92% are of smaller scale.

What's in it for a smaller, recently established gallery business?

For a small gallery based in London, the costs of participating in an art fair like Frieze or a similar event would likely range between £20,000 to £50,000, depending on various factors. Since they are already in London, travel and accommodation costs would be minimal, saving a significant portion of the budget. However, other major expenses such as booth rental, shipping, installation, and marketing would still apply.

Booth rental costs are a major part of the budget, typically ranging from £10,000 to £30,000 depending on the size and location within the fair. A smaller gallery might opt for a smaller booth or one located in a less prime spot to keep rental fees lower. Since the gallery is already local, shipping costs for artworks would be reduced, likely around £2,000 to £5,000, as transportation within the city is far less expensive than international shipping.

Setup and installation could add another £1,000 to £3,000, depending on whether the gallery hires professional installers or handles it with their own team. Insurance for the artworks would likely cost around £1,000 to £3,000, based on the value of the pieces being exhibited.

Marketing and promotion would be another necessary expense, possibly between £1,000 and £5,000, depending on how much the gallery invests in printed materials or advertising. To reduce costs, the gallery could focus more on digital promotion and social media outreach. The application fee, typically around £500 to £1,000, would be a fixed cost for entering the fair.

To make participation profitable, the gallery would need to adopt a strategic approach. One way is to focus on showcasing works that are priced within an accessible range for a wider audience, rather than exclusively high-end pieces. This could attract new collectors who are looking for emerging artists or more affordable investment opportunities. Offering smaller, lower-priced works could result in multiple sales, which would add up and help cover the costs.

The gallery could also benefit from building strong relationships with collectors, curators, and other art professionals during the fair. Even if immediate sales are modest, these connections could lead to future sales, exhibitions, or commissions. Furthermore, increasing visibility through the fair’s promotional materials and media exposure can enhance the gallery’s profile, attracting potential clients and collaborators long after the event.

Another strategy would be to network with other galleries and potential partners, which could lead to future collaborations or even shared resources for other exhibitions. While immediate profitability may not always be guaranteed, the long-term benefits in terms of exposure, relationships, and brand-building could result in future profits that go beyond the fair itself.

By carefully managing costs, choosing the right works to exhibit, and focusing on building relationships with buyers and the wider art community, a small gallery in London could make art fair participation profitable, not only in terms of sales at the event but through long-term growth and visibility.

Not surprisingly, this whole scenario complicates further when we put the camera on an independent artist’s shoulder.

The biggest art fairs today are set up mainly for art galleries which represent their stable of artists. It is rare that artists can represent themselves at these events, and if they have the means to cover those costs, it often means they are already represented by a gallery.

A possibility for emerging artists is to explore artist-run fairs. While these fairs don’t necessarily host individual artists, they are open to collectives, artist initiatives and independent projects.

Artist-run fairs are less focused on sales, and more on supporting and showcasing the artist-run sector. Toward this aim, they often offer dynamic public programming alongside the fair presentation itself, including performances, artist talks, discussions, etc. Artist-run fairs can provide a good platform for artists who organize as part of their practice — as a group, collective, project space, etc.

Art fairs can be highly profitable for organizers, depending on several factors like booth fees, ticket sales, and sponsorships. Fees for exhibition spaces are a major revenue source, with premium fairs such as Art Basel charging tens of thousands for prime booths, while smaller, artist-run fairs, like Supermarket – Stockholm Independent Art Fair, offer more affordable rates. For example, Supermarket, established in 2007, charges exhibitor fees starting at €523 for artist-run spaces and projects, and focuses on self-organized, artist-run initiatives. These types of fairs also engage participants with professional networking programs, which generate additional revenue through participation fees (around €196 for Supermarket’s program).

In contrast, larger commercial fairs like The Other Art Fair in London, presented by SaatchiArt.com, offer more expensive booths, with a 2-meter booth costing £1,575 + VAT. These fairs combine accessible works with immersive experiences and generate income from ticket sales, workshops, and sponsorships.

Costs for organizers include venue rental, staffing, marketing, and insurance, but for established fairs, the potential for profitability is high due to strong branding and consistent exhibitor demand. Smaller fairs, like Supermarket, may operate on thinner margins initially, but can grow in profitability over time as they attract more participants and sponsors.

To sum up...

Remember the benefits of art fairs can extend beyond monetary value. Even if immediate sales don't cover all your costs, the networking opportunities, feedback, and exposure can be invaluable. Many artists find long-term benefits in the connections made, leading to gallery representation, commissions, and more. 

With a strategic approach to choosing, preparing for, and participating in art fairs, you can maximize your chances of success and view each event as a stepping stone in your artistic journey, rather than a make-or-break moment.

Art fairs are a significant investment, but with the right strategy, they can offer immense rewards. By carefully selecting the right opportunities, managing costs creatively, and leveraging tools like Artwork Archive, you can make art fairs a valuable part of your art career.