Special relationship

For the past 20 years or more the auction houses have been doing their utmost to wrest the retail art market out of the hands of the dealers. Few would disagree that they have had considerable success. In taking over Sotheby’s in 1983, the Detroit shopping mall billionaire Alfred Taubman saw what he called ‘a unique marketing opportunity’ in transforming what was essentially an up-market but loss-making wholesale operation — the majority of saleroom buyers were dealers — into a glamorous retail business. The allure of turning a profit by circumventing the dealers was irresistible. And the real beauty of it was that this ‘retail’ business did not require any investment in expensive inventory.

All that was needed was to persuade the newly affluent that they needed to acquire works of art and that the saleroom was the place to buy them. No less importantly, to lure the potential consignor their vast publicity machines told the world that the heat and drama of a saleroom bidding battle would generate a far higher price than any level-headed dealer would be prepared to offer any client.