How to Organize an Artists' Cooperative Enterprise
Based on a Model in Germantown, Tennessee by Patricia Thompson
Germantown, Tennessee has few art galleries and artists in the area did not have adequate representation locally. Some of the galleries are excellent, but were not able to properly represent all the qualified local artists. In order to exhibit on an ongoing basis, we needed an alternative. Some of us were loosely organized into an artists' gallery-a very casual group which made decisions in an often haphazard fashion. While I felt the concept was valid, I did not always enjoy the lack of organization. I kept thinking that we could be more profitable if we were well organized and selected our members wisely.
In December of 1985,1 founded and organized our artists' co-op. The co-op has been successful since opening and every month we do better. We are always open to new ideas and methods which will make the group more successful Our program is arranged to benefit both the individual artist, as well as the co-op.
Several factors contributed to the initial smoothness of our cooperative venture. I have a background in administration and was familiar with real estate. I personally knew each artist invited to join us, or had a recommendation for them from someone I knew. The dedication of everyone in the group made painting and cleaning our newly acquired space and other tasks go quickly and efficiently. Today, two years later, the members of the Co-op are still saying this was the best thing that ever happened to us.
Securing a location
We selected a space in a very attractive shopping mall, located in an affluent part of town. I approached the mall, explained the nature of our co-op and pointed out the benefits of having a gallery in the mall. I said the artists would be working in the space and having shows, which might bring a new clientele to the mall. The owners of the mall were pleased to lease space to us.
We worked out a short term lease agreement Under the circumstances, we felt it was important not to become financially responsible for a year's lease when the co-op was in its infancy. We obtained a 30-day lease with automatic renewals; either party was obligated to give 30 days notification if the space was to be vacated.
It is important to read the lease agreement very carefully. Be aware of which party is responsible for the maintenance and repair of the space, both interior and exterior, and who will handle problems which might arise with the heating or cooling system, toilet facilities or other mechanical areas within the space. While many leasing agents have standard contracts, most items can be negotiated in or out of a contract.
Once you have agreed on your lease, you must contact the utility companies. Usually a larger than normal deposit is required for a new business. We elected not to get a telephone because the deposit required was very high; we decided we would rather work on art when we were in the gallery and not take care of personal business.
When you open a space or gallery in a business district, you will have to receive approval of the sign you place above your business entrance. If you select a mall location, like we did, you will need to submit a design to the mall management for approval and make any changes necessary. Our sign uses our Co-op logo, which we also use on our business cards and stationery. It is now recognizable and is associated with the co-op.
Careful selection of artists is the single most important item to deal with. Quality of work, as well as personality, should be considered. Members will have to share in the decision-making and the work of running a co-op together. Everyone has to do their share. A mutual respect of each other's art is also essential. When browsers come into the gallery, the member on duty has to refrain from pushing their own work over that of other members. Scheduling staffing and cleaning is often harder than you might think, but we have been very successful in doing this because of the compatibility within the group.
Setting up a front end contract with each artist is important. When new artists sign contracts with us, they are also given a membership list and a list of general sales guidelines to follow. We have set a limit of 24 members at any one time. We do keep a waiting list of artists wanting to join the Co-op.
Each of the 24 original artists who joined the co-op paid a $50.00 fee (nonrefundable) to cover startup expenses and ongoing maintenance. Each new artist that joins our co-op is also required to make this payment When we were just beginning, our initial deposit of $1200 was enough money to get started. To meet our monthly expenses, each artist is assessed an equal percentage of the expenses as a monthly fee. We fry to keep a little extra for emergencies. It is not our intention for the Co-op to make money. The main purpose of the co-op is for artists to have a place to exhibit and sell artwork.
If an artist has an illness, or cannot fulfill their commitment to the gallery for a short period of time, a guest artist can be invited to fill their position for up to six months. We invite potential co-op artists to attend a monthly meeting as a form of introduction. As a guest artist they are not assessed the $50.00 donation or the full dues. If a Co-op member is to be gone longer than six months, they must resign and a permanent replacement is found.
All permanent members must pay their dues at the monthly meeting. If an artist falls behind in their dues, they risk dismissal.
We chose to incorporate to avoid putting each member of the co-op at personal financial risk. If an accident or injury occurs on the co-op premises or the business incurs debts that cannot be repaid, it can present a legal nightmare without incorporation. Incorporation means the business can be sued for all of its assets, but the artists that run the business are not personally liable. We work without debts by paying as we go. If we can't afford it, we don't buy it.
When you are ready to incorporate, it is important to find an attorney that specializes in incorporation. Don't be afraid to shop around and inquire about the fees. As a small business, a complicated incorporation is not needed. A standard incorporation application is sufficient. If the business is going to be nonprofit, this can be handled at the same time. After filing, it may take six weeks or longer for the paperwork to be completed.
We established a board of five to handle the major business decisions, such as insurance, mall representation, lease and other financial matters. We also appointed a director to handle the day to day problems and general guidelines. Other artists in the co-op are assigned certain jobs, such as secretary, treasurer, supply person, publicity person and monthly scheduler. These positions are all without pay.
We have a monthly meeting, usually lasting an hour, in which we discuss necessary business, set up open houses and bring up new ideas. We rotate our artwork in the gallery once a month and require members to use 30% of their space for new work or work that has not been shown in the gallery in the last four months. All members have equal spaces. Each month we rotate three spaces forward; this way each member has a chance to be in all of the gallery spaces. This rotation also provides a fresh look to the gallery each month.
Our gallery is staffed exclusively by the 24 artists whose work is displayed and we are all volunteers. Having 24 members works perfectly for filling a 3-month work period. Each person signs a schedule for three months and works every other week. Of course, a lot of trading goes on, but each member is responsible for their days and handles the trades. Two members work together at the same time, so one person is always on duty during lunch or when a customer is being helped. With the 3-month schedule, two members clean the co-op at one time. We straighten up and take the trash out each day and the co-op is cleaned once a week.
We do not charge a commission on artwork sold. We feel each artist should share expenses equally, whether they sell a lot or a little. Each piece of artwork in the gallery is listed on a 3" x 5" file card and placed in an inventory box. On the front of the card we list the pertinent information about the piece and on the back is purchaser information, to be filled in when sold.
We have a layaway payment plan, gift certificates and a loan policy, which allows a customer to take home a painting on approval. The customer leaves a check for the amount of the artwork, signs an agreement to return the artwork undamaged and has a chance to live with the piece for a while without purchase. The check is not deposited until the customer returns or purchases the painting.
We keep a daily log in which we sign in and out, note sales, customer needs and general information. In it, we also keep a record of monthly sales and expenses. A copy of the artist's agreement and general sales guidelines are kept in the book. The minutes of our monthly meetings are kept in a separate book. Each artist reads the daily log kept on the days they work.
We have an open house every four months-- in April, August and December. Approximately two months before an open house, two members are assigned responsibilities for the show, including invitation, publicity, refreshments and gallery preparation. When the invitations are printed, they are addressed by all co-op members on the days they work.
We have a guest book in the center of the gallery. When an interested customer comes into the co-op, we ask them to sign the guest book. These customers regularly receive invitations to our open houses. When someone purchases something from a co-op member, we make a file card on them and type a label We do this on an ongoing basis; now, when we have an open house, all we have to do is photocopy our labels for the mailing.
The first year of operation we tried many different types of advertisement mailers, fliers, ads in local magazines, newspapers and open houses. We discussed these methods at our meetings, so each member would become familiar with advertising procedures and costs.
One year we cooperated with the mall to co-host a children's art show. The show brought a lot of new customers to our gallery and to the mall. It was so successful that the mall wanted to do it the following year; although it was extra work, it was well worth the effort for the marvelous publicity it generated for the Co-op.
We spend time listening to our customers. They tell us all kinds of things, like how they like the gallery, what kind of art they want, etc. This has helped us be more responsive to the art receptive community in our area.
We also contacted our local newspapers and invited them to visit the co-op, with the hope they would write an article about our gallery. Three newspapers did.