During my professional career running exhibition spaces or driving visual art projects, especially in my past work with Presentation House Gallery and Artropolis, I dealt with many incidents involving the loss, damage or theft of an artwork. Far too often, the artists whose works were lost, damaged or stolen, did not receive adequate compensation for their loss. Every one of those dissatisfied artists could have secured appropriate compensation had they kept better sales records and had a price rationale.

When I started selling my own drawings, I valued my experience with insurers because it led me to the decision to create a price rationale for my work from Day One, and this is an opportunity you have as you move to professionalize your practice. What follows below is a summary of the thinking and actions I took to ensure that I would be adequately compensated for loss or damage to my work. Insurance, I found, was useless if you did not have sales records to back up the valuations you place on your work in the insurance policy.

Many years ago, I did a series of drawings that were 26" by 40". To set prices for my work, my first step was to tour around galleries to look at the prices of pieces of a similar size - particularly if they were drawings. I concluded that $2,000 was the right price for each piece. As horrible as this sounds, I then calculated my price per square inch. ($2,000 divided by (26" x 40") = $1.923 per square inch. This calculation helped me price the smaller pieces I did next. By basing my prices this way, all my pieces were consistently priced. I had a sales rationale in place. As my career developed, I knew I would simply raise my price per square inch and that throughout my career, I would never have trouble with insurers. When I tried painting, I felt the extra cost of the materials and other factors that I wrote down in my sales history book, required that my price per square inch for acrylics would be $2.13. These were rates for me - an amateur.

My drawings sold well, and the vendor wanted to start selling more for me. Confident of the value of my work due to the success with sales, I turned the offer down because I was only receiving $1,200 per drawing sold (ie: the sales commission was 40 percent.)

Once I started drawing, and before I made the sale, I was developing an inventory of drawings in my home. I called my insurer and discovered that my homeowner's insurance covered the work as long as it was in my house and the inventory was well documented. I provided a detailed list of all my pieces for the insurer, took pictures of each one and placed a value on each drawing of $2000. The insurance agent replied, "Fine, no problem, if you have three sales to back up your evaluations." We had a long talk and he found me to be very well protected with my price rationale. All I had to do was sell three pieces that fit into my rationale, to prove the "per square inch" value of my drawings. In this way, no matter what size of drawing I did, I was covered. Every insurer, the agent said, would recognize my sales rationale if three pieces were sold. That's when I started keeping a detailed and accurate sales record.

After that first show and sales went so well, I thought, "If I can do that twice a year, I could make some great money." So I resolved that if I did two shows a year, that I would "up" my base price per square inch by at least the annual rate of inflation, and that it would also take a modest jump up each time I passed certain landmarks. For example, once I had sold 20 pieces, I felt I could up my price per square inch - again, modestly, and that each increment would be documented and rationalized in my sales diary.

One interesting issue as I implemented my plans was the tug-of-war I experienced with the vendor of my work in seeking accurate sales information. Having talked this issue out with colleagues, I heard horror stories about vendors who discounted prices without authority, who would not reveal buyer information and sales figures, and worse, those who delayed artist payments well after the sale. Going into my relationship with my vendor, I had in my contract (the base contract having come from CARFAC's Copyright Collective website) clauses that required the vendor to inform. I wanted to have a list of all my buyers and the price for my sales records. This was murder to negotiate. Once my sales went so well, it was easier to get co-operation. One thing to note here is that since the vendor took 40% of sales from the show, I promised to pay 10% of any subsequent sales to every buyer who came to me through her work. If I could sell directly to the buyer, and not through a show, I would be making 90% instead of 60% of each sale. That difference of 30% meant I was earning an extra $600 per 26" x 40" drawing.

I had six pieces in that first show and all but one sold. That one sold at Christmas later that year. And each piece got the price I wanted, so my sales rationale guaranteed me easy and accurate settlement of any insurance claims for the rest of my life. Also, when I did a small drawing for a charity art auction, I used my price rationale to value the work, and the charity used my sales records to back up the value of the tax receipt they issued to me. No appraisal was needed!

Research undertaken by Federation of Canadian Artist member, Robert Ashcroft, will be of interest to any artist establishing a market value for their work. Robert wrote an interesting article in "Art Avenues," the magazine of the Federation of Canadian Artists (Vol. 1, No. 3 Sept./Oct. 2001, pg.10). In his article, he analyzed the structure behind the pricing of FCA member artworks pictured in the magazine. He based his approach on what he learned from the sizes and prices accompanying the pictures of 93 artworks.

Mr. Ashcroft wanted to see how his pricing system "fit" into a rationalized system as carried out by some Federation artists. His method did not include aesthetics of the artwork but rather a quantitative evaluation of pricing. He determined the price-per-square-inch value of each piece based on the ninety-three artworks reproduced in the FCA Publications, by thirty-four different artists. His research revealed an average price-per-square-inch asking price of $3.32 for acrylics, $3.18 for oils, and $4.48 for water media. Nineteen artists had more than one work in the inventory and were, therefore, evaluated for consistency in their pricing. Of the nineteen, only seven appeared to be using a pricing system.

There are many benefits to having a price system: none of your buyers will ever feel cheated by your pricing policies no matter how large or small your pieces are, you can expect appraisal-free' legal receipts when gifting artworks, and you will have a very valuable back-up for all your insurance initiatives.