By Juliette Yuan. March 3rd, 2021. New York
How art consultants contribute to our lives and businesses – no matter the time in which we are living - is a question that people ask all the time. I remember having gallerists, artists, collectors, and other art professionals ask me this question at different times and in various situations during my career. “What is a consultant?” “What do you consult?” “What CAN you consult??” “How do you consult?” “We already have dealers and gallerists. Why do we still need consultants?”
I found these questions challenging at the beginning of my consulting career, as they forced me to clarify the responsibilities and capabilities of an art consultant that I was not sure how to articulate at the time. I also realized that art consulting as a profession was not well understood by both the outsiders and the insiders of the art world. Different countries, cultures, market regulations, educational backgrounds, and professional paths are all decisive factors that help art consultants define their focus, responsibilities, and services. In most cases, art consultants are considered to be salespeople who can help artists and collectors find each other and make transactions happen. However, in reality, the value that art consultants can create for their clients and their community is way beyond a few transactions.
As we enter spring and the hope that our world is heading to a better place, we want to offer some clarification on our profession so that you know how to help us contribute to your lives and businesses at the time you need us.
What is an art consultant, and what do they consult?
Art consultants, also known as Art Advisors, play a key role in the art market. Their primary work is to assist private collectors and corporations to build their art collections by advising them on acquisitions and sales. In addition, art consultants also provide their expertise in provenance research, market research, exhibition curation, art collection management, conservation, insurance, art handling, installation, and interior design. Art Fiduciary Advisors also work with experts in law and finance and provide strategies to their clients in investment planning, collection inheritances, estate planning, and taxation. Art consultants can be contractors or full-time employees of a corporation; others can work independently advising multiple clients. They specialize in different periods of art history with focuses on different art genres and media and are hired to bring value – both aesthetic and financial – to their clients.
A clear and straightforward definition for professional art advisors can be found on the Association of Professional Art Advisor (APAA)'s website, under What an Art Advisor Does, and its Code of Ethics. The term that differentiates art advisors from art dealers and gallerists is that advisors “may not maintain inventory for sale, accept artwork on consignment or act as private dealers in any transaction.” Different from the gallerists who promote primarily their own artists and inventory to their clients, advisors conduct their research and plan art visits upon their clients’ needs, broadening their knowledge of art to as many art institutions as possible. They explore their entire professional network and all resources in the art world to help their clients reach their goals.
Who needs an art consultant?
Everyone interested in art and thinking to buy art – referring to the original works of art created by living or late artists - should consider getting in touch with an art consultant before doing anything. A new art buyer needs to keep the following in mind before she or he realizes the first purchase:
(i) Art is both a passion and an asset. Art collectors are those who know how to value both and navigate in between with long-term plans.
(ii) Buying art and collecting art are different activities. Art buyers buy what they like. Art collectors focus on what represents their core values, build a body of collection around a specific theme or topic. It takes a lot for an art buyer to become an art collector.
(iii) Before you decide to purchase an artwork, think about where you want it to be when you can no longer be there with it. Will you leave it behind you, abandoned and lost? Will your children, relatives, or friends keep it and love it at your place? Will you donate it to a charity?
Seasoned collectors also hire consultants to work on specific issues around their collections. The best case study I read so far is from the art fiduciary advisor Doug Woodham’s article in Wealth Management Magazine (June 01, 2020): “What to do with a $45 million art collection. A case study of what’s involved in creating a pragmatic financial plan for a valuable art collection.”
At the end of his article, Woodham concluded: “I believe collectors can assess whether they need a holistic financial plan for their collection based on three factors. The first factor is the percent of family wealth tied up in art. […] Second, … how liquid is the collector’s remaining balance sheet? If it’s similarly illiquid, perhaps because it’s invested in real estate and private equity, it becomes more important to have a plan for the art collection. Lastly, how many objects are in the collection, and in how many different collecting categories? The larger and more diverse a collection, the more important it is to have a financial plan that reflects the idiosyncratic and nuanced marketplaces where objects in each collecting category are traded.”
Doug Woodham’s article showcased how an art collection can make a significant impact on the lives of more than one generation in a family. It's not a bad idea for new buyers to understand the value of art at both emotional and financial levels before they start spending their hard-earned money to create the life they have dreamed of.
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