Art consignment basics

Most galleries don't buy the work they show. They take it on consignment: you leave the work with them, they sell it for you and keep a commission, and anything that doesn't sell comes back.

Who's who

Consignor

Whoever owns the work and hands it over to be sold. Usually that's the artist, and the work stays theirs until it sells.

Consignee

Whoever holds the work and sells it. Usually a gallery, sometimes a dealer or a shop.

Sale-or-return

How most consignments work. The consignee pays for what sells and sends back the rest.

The consignor isn't always the artist. If a gallery passes an artist's work on to another gallery, the first gallery is the consignor. If a collector asks a gallery to resell something, the collector is.

Commission

The gallery keeps a share of each sale. Between an artist and a gallery, half is common, but it moves with the gallery, the market and how established the artist is. Two things are worth settling in writing: what the commission is a share of (the full price, or what's left after costs), and whether a discount to a collector comes out of both your shares or only the gallery's.

Costs

Framing, crating, shipping, insurance and photography add up. Agree who pays for each, and whether any of it comes off the price before you split it. For example, a work sells for $4,000, you paid $400 for the frame, and the commission is half:

• If the framing comes off the top, $3,600 is split. The gallery keeps $1,800, and you get $1,800 plus your $400 back, so $2,200.
• If the commission is on the full price, you each get $2,000, and you've already spent $400 on the frame.

What to put in the agreement

• Who's consigning and who's selling.
• The works, each with its inventory number, its price, and what you get if it sells at that price.
• The commission, what it's taken from, and how discounts are shared.
• Who pays which costs, and which ones come off the price first.
• How long it runs, and what happens to anything unsold at the end.
• Who insures the work while the gallery has it.
• When you get paid after a sale, for example within 30 days of the buyer paying.
• Whether the gallery can photograph the work and use the pictures to promote it.

Some places, including several US states, have laws that protect consigned art, for example by keeping it and the money from its sale away from the gallery's creditors if the gallery goes under. It's worth checking what applies where you and the gallery are.

The consignment list

When the work goes, a list goes with it: each work, its price and the commission, for the gallery to sign when the crate arrives. It's your record and their receipt. Keep it up to date as things sell and come back, so you both agree on what the gallery has at any point.

What to keep track of

If you're the artist

• Which works are with which gallery, so you never offer one twice.
• The price and commission you agreed for each.
• Every sale they report, and whether their figure matches what you agreed.
• What you've been paid, and what you're still owed.
• What came back, and what state it was in.

If you're the gallery

• What you're holding for each artist, on what terms, and until when.
• Each sale, split into commission, costs and what you owe the artist.
• A statement for each artist of what sold and what they're due.

When it ends

At the end of the run, unsold work goes home and you settle up. Go down the list and check that every work has either sold or come back, every sale has been paid for, and the costs have been shared the way you agreed.