Sotheby's Developing Chinese Markets

The ArtNewspaper has an interesting recap of some of Sotheby's current issues and strategies.  It covers a little bit of the labor strife with the art handler strike, Jame Murdoch who sits on the Sotheby's board, a strong focus on China with reductions in activity in the US and parts of Europe, and a continued focus on increasing the now important private sales division.

None of this is very surprising and most is well documented in sales information as well as Sotheby's financial reports.  I have posted on many occasions the importance of newly developing markets with a primary focus on China and the other BRIC nations, and of the recent growth and importance of private sales.  But the interesting aspect is the direct mention by Sotheby's CEO that the house is reducing activity in the US to focus more on the Chinese market.  From this we can gather that Sotheby's believes the Chinese art market is going to continue to grow and be a strong future financial component and perhaps, the most important region for art sales as the Western markets decline in dominance.

The ArtNewspaper reports

Ruprecht also said that China now represented “the largest art market in the world today”. He said that, at the same time as investing in Asia, Sotheby’s had “reduced the number of units and volume of activity that we pursue in the US in particular”.

A $7.9m (or 24%) increase in administrative costs in the second quarter was largely due to “consulting fees to develop some of our strategic initiatives, particularly in China”, added William Sheridan, Sotheby’s chief financial officer, while a $1.6m increase in marketing expenses for the first six months of 2011 was due in part to brand promotion in China. Meanwhile, Ruprecht added, a restructuring plan to streamline European operations, notably in Italy and the Netherlands, “will allow management to focus on growing markets, especially China”.

To read the full ArtNewspaper article, click HERE.