The Romanian art market recorded a negative profit of -100,000 EUR in 2022, according to an extensive study conducted by a marketing agency specializing in the cultural and creative industries, commissioned by Scemtovici & Benowitz Gallery.

The analysis covers the period from 2011 to 2022 and includes 54 significant private entities within the local art ecosystem: three of the most important auction houses (Artmark, Vikart, and Ans Azura), relevant art galleries from Bucharest and major cities in Romania, and artist-run spaces with consistent activity, which provided data either directly or through official reports. Data for 2023 were unavailable at the time of the study.

The first conclusion reveals that most market participants operate out of pure passion, meaning they recorded losses according to the annual balance sheet as of December 31, 2022. Sharing the same passion for art, we support the cultural and creative industries by publishing the most interesting findings of the study, and why not, a series of figures that add color to life. After all, we are talking about art.

Another standout aspect, much like the yellow in Sălișteanu’s works, is that out of the total turnover of 21.6 million EUR reported for the Romanian art market (January 1 - December 31, 2022), 17.3 million EUR represents the combined turnover of companies operating under the Artmark auction house umbrella (A10 BY ARTMARK SRL, ART SAFARI SRL, ARTMARK HOLDING SRL, SINEVA EVALUARI ARTĂ SRL). Being the first on this market, they rightfully have the lion's share. Some might say they dominate it, with 80% being an evidently dominant position, but (to their credit!), we would say they practically created this market when there was no art market in Romania.

Using simple math, the rest of the art market players – including the two younger auction houses – accumulate a turnover or total sales of 4.3 million EUR.

If we also exclude the cumulative profit of companies under the Artmark umbrella, which is positive, the total profit of the Romanian art gallery sector along with Vikart and AnsAzura offers an even more realistic (pessimistic) picture: -300,000 EUR.

For comparison, staying in the cultural domain, Humanitas Bookstores had a turnover of around 6 million EUR in 2022, with a (positive) profit of a few hundred thousand EUR. Humanitas Bookstores represent the third most important bookstore chain in Romania (neither the first nor the second!). In other words, if all Romanian art galleries were part of a single commercial entity, the entire industry would still be far from the figures of the third-largest bookstore chain nationally.

Considering the negative profit of -100,000 EUR for the fiscal year ending in 2022, we understand that the small Romanian art industry of 21.6 million EUR operates with costs of 21.7 million EUR.

The conclusion that art generally operates with “money brought from home” is reinforced by another figure, the total debts of those included in the study, which cumulatively amount to 18 million EUR. This figure represents, on the one hand, investments that have been made or are still being made by industry players. But it may also conclude that galleries are probably the largest purchasers or investors in art in Romania, buying the artworks they exhibit today, believing that the purchased works will have a higher price in the future.

However, we would like to highlight a few cultural operators whose figures are positive (in this semi-disastrous context), indicating that they are doing a good job or, at least, are on the right track.

Although there is a hierarchy, it is not our intention to create a ranking. We could say, however, that the galleries Suprainfinit, Plan B, Ivan, Posibilă, Anca Poterașu, Sector 1, Anaid, JECZA, Rădulescu Galleries, Nemțoi, and the Vikart auction house deserve appreciation, noting that the profit leader is Rădulescu Galleries, with a declared profit of 551,803 lei, the second profit after the undisputed leader, Artmark. It should be noted that Rădulescu Galleries, like Artmark, do not only promote contemporary art but also modern art, selling period furniture and jewelry, thus being closer in portfolio to the area covered by the leader.

The conclusion that can be drawn is that the profits of art sellers still come from the classics Grigorescu, Tonitza, Luchian, and their contemporaries (remarkably, there are still works to be found after so many years), while contemporary art evidently brings modest profits and mostly losses.

This conclusion raises a question, which we address to current buyers of impressionist and modern paintings: “Distinguished collectors, don’t you have the curiosity to anticipate who today’s future Tonitza and Luchian are, if we relate to modern Romanian art, or the future Adrian Ghenie, Victor Man, Câlția, or Ilfoveanu? To buy now, at prices several times lower, compared to the prices you will pay in 10-15 years. Wouldn't it be interesting and challenging?!”

In terms of turnover, Artmark is followed by the Vikart auction house, then by Plan B gallery, placing Plan B at the top of Romanian contemporary art galleries with the highest sales (even though Plan B’s turnover is made in Berlin). To ensure the accuracy of the information, there are 2-3 significant galleries that did not provide data. We do not know how their turnover would have influenced the presented data, and Kulterra, GAEP, and MARE Museum each operate with an NGO, an association type, as their organizational form. I know it may seem odd to mix auction houses with galleries, modern art with contemporary art, but in the context of our very small art market, categorizing would have made the figures seem more trivial.

At the other end of the ranking are several galleries that have been operating at a loss for years. Some of them, not few, reported and still report zero turnover, meaning they exhibited art without selling a single work throughout 2022. Also noteworthy, with consistency like the lines accentuating Florin Mitroi’s portraits, are the figures of Nicodim Gallery, which, since opening in Romania in 2013, has only reported debts and losses. We do not know the local policy of the gallery, but maybe they adopted the style of multinationals that report losses in Romania while showing profits in their home country.

Looking back at the 12 years covered by the study commissioned by our gallery, we cannot help but notice that in 2020, the Romanian art market had a cumulative, positive profit of 1,120,423 EUR. Perhaps the pandemic was a real success for many, as this aspect is evident in the figures. As they say, during calamities and war, you invest in gold, and in art, or, as the case may be, in NFTs (since they saw an upward trend during the pandemic, after which things kind of "deflated").

In 2011, only 11 of the analyzed entities that presented financial data (probably only 11 existed, plus those that existed but have since closed and were not included) reported a cumulative turnover of 11.8 million EUR and a profit of 791,000 EUR.

As can be easily seen, whether the profit of the Romanian art market is or isn't, depending on the year... we can say that the turnover of the analyzed cultural entities has almost doubled from 2011 to today, which, considering we are talking about no less than 12 years and a small market, is rather discouraging for any business analysis.

Analysts say that small markets, if well managed, have great growth potential. There are small markets that grow 100% each year.

The art market has not achieved 100% growth even in 12 years.

The final conclusion is one with a bitter taste. Just to get a small idea of where we stand, the Romanian furniture market is around 2 billion EUR, of which the interior decorations market is over 250 million EUR. Since art is at the border between decoration and luxury, I will also mention that the luxury market in Romania was, in 2023, at the level of 1.38 billion EUR.

There is money in Romania and high-income Romanians as well. There are a few tens of thousands of millionaires living in Bucharest.

It is clear that we in the art market are doing something wrong.

In 2023, the first year of Scemtovici & Benowitz Gallery, an ambitious international art fair was launched, which could have brought relevant galleries together. Let’s not forget that there were similar intentions in the past, or at least that’s how ArtSafari started in 2014.

Due to some differences of opinion, over which it was not possible to pass in our small art market, differences that we still do not know today, shortly thereafter, another art fair was announced... It was probably a good thing that two large fairs were organized and, in a certain sense, the art industry benefited. However, it was bad that in such a young market, other factions emerged, after so many others.

I firmly believe that the only way is the collaborative one, whether it is art galleries, auction houses, or museum institutions.

The only chance for this small industry is for syndicated marketing efforts (Yes! Syndicated, you heard right! Let’s at least follow the French model, as they have results in this regard, and this aspect is visible in the figures!) of art galleries to become visible enough to make art count (at least as much as a city break, a watch, a piece of jewelry, or at least as much as a bottle of Petro Vaselo) for the almost one hundred thousand Bucharesters who can afford to purchase quality contemporary art.

This is the real competition for art galleries, which must become as attractive as other dopamine providers!

RAD (radartfair.com) is wonderful, MOBU (mobu.art) is exceptional, but two flowers do not make a spring. The public needs constant events throughout the year, like Art Safari (artsafari.ro – congratulations!!!), to keep Bucharesters, and not just them, close to the visual arts phenomenon.

In “The Survey Of Global Collecting 2023,” a report published by Art Basel & UBS, we learn that the total art sales at the end of 2022, 65 billion USD, are distributed as follows: USA 42%, China 19%, UK 17%, France 7%, Switzerland 3%, Germany 2%, Japan and Spain 1% each. The remaining 8% is distributed among all other countries in the world. However, it should be noted that the countries in the top 8 art sales are in the top 20 GDP worldwide and in the top 36 in terms of GDP per capita, not in the top 10 as we might be tempted to believe.

This indicates that it is not the consumers’ money that is most important, but culture and education are much more important, which gives us hope. It suggests that what we need to do is work primarily on the culture of the audience.

As for the artists, the news is... they exist! These silent heroes, for whom I have sincere admiration. The figures from the report indicate that the most successful artists who sell works in Romania at significant prices and consistently are those who are no longer... among us.

For the others, things are not simple. A small part of them have the chance to be represented by an art gallery (there are fewer than 50 galleries in Romania with consistent relevant activity and several thousand artists). But given the situation of the galleries as described above, we see from the figures that you can be represented by a gallery that sells nothing or one that sells insignificantly. You can also, evidently, have the chance to be represented by a gallery that believes in you and, although it doesn’t sell, buys your works for its own stock. Crisis situation, crisis solutions.

Of course, I consider it better to be represented by a gallery, it is a considerable plus for image and credibility. It is better to have your goods on the shelves of a supermarket and to be listed in the store's offers and on the website than to be unknown and keep the goods in the warehouse, in the studio, or in the living room, as the case may be. But it is not a long-term solution if the galleries do not soon do something relevant.

Given that I am also an artist and often go through the pains of creating an artwork, I understand this position well, so I allow myself to give advice to the artists reading this article, this time from the position of a colleague in the field.

It is said that artists have their heads in the clouds. I tell you – be realistic! All successful artists precisely meet two performance criteria, they have a body of work and a strong personal brand. Even those who achieved success after they finished their business with this world, posthumous success, met the criterion of having relevant work, and (someone else) took care to build a personal brand. Picasso, Dali, Van Gogh, and Modigliani all have important, exceptional works. All four have a very strong personal brand, have museums, movies made about their lives, and sell at enormous prices at auctions. The major difference is that Picasso and Dali understood that a personal brand is very important and worked on it themselves during their lifetime, reaping the benefits themselves, while in the case of the other two, someone else developed their artist brand following rigorous marketing principles and reaped the benefits. And today, I would say that the personal brand is almost more important than the work itself, otherwise, balloon dogs cast in metal (see Jeff Koons) or bananas taped with duct tape (see Maurizio Cattelan) would not sell so well as artworks. Therefore, I advise you to go to galleries, especially those that promote your work, buy pieces for stock, the living proof that they endorse your work, and also develop your personal artist brand.

Mihai Scemtovici