Author: Michael Chappell

Any panicked calls to your broker yesterday? Dumped any assets at market price to purchase gold? No, I bet you didn’t, nor did anyone I know. Business as usual, or as much as usual, watching from the sidelines as the markets ticked downward.

What’s unfortunate is the effect that the S & P downgrade of US sovereign debt had on shaky world markets, imperiling a fragile economic recovery. The operative word, though, is ‘recovery’, and all those of us in business have felt it. And anyone in business can, if they’re paying any attention to more than just the day to day, use their own business as a paradigm. Revenue is the most obvious measure, but product sales start with buyer interest, and that’s markedly improved over last year. Mind you, we cautiously husband incipient sales, because it had heretofore still been easy for a client to say ‘no’. But, then, I haven’t had any pending sales cancelled outright the result of what’s gone on over the course of the last three weeks, but doubtless the cash conversion cycle has now lengthened.

The forest of finger pointing has mercifully not occluded reasonable discussions about the downgrade. The most cogent, expressed by Paul Krugman, was that nothing in the US economy had changed. The received wisdom that political gridlock in Washington that led to a laggard agreement on raising the ceiling for sovereign debt was somehow indicative of a lack of will on the part of the government to get its financial house in order does not, in Krugman’s view, wash. Nor does it in mine. The US remains the most important, most productive economy in the world, and the safest of safe harbors for investment. Moreover, a debt deal was reached- as we knew it would be- and the US, despite the stylized posturing on all sides that I’ve heard compared to kabuki theatre, remains a beacon of political stability. The question has been asked of S & P amidst this how reliable their ratings can be considered given their investment grade ratings on the subprime mortgage funds, the collapse of which, we all recall, precipitated the morass from which we are slowly emerging. The question’s been asked, but has S & P answered? Not that I’ve heard.

More common sense from Paul Krugman at:

http://krugman.blogs.nytimes.com/

…I’ll show you mine. Face it- that’s a prospect as tempting now as it ever was. And dealers and fair organizers alike should hearken to the concept.

Mind you, I’m not advocating the addition of peep shows to any venue. Perhaps not strongly advocating, as, in Jackson Square, just a few blocks from the sex clubs along Broadway I can tell you so far it hasn’t provided us much benefit. What’s put me in mind of this old concupiscent phrase is what I read recently about the changing dates of the fairs in the still tediously extended London Season. When things were running well in the trade, the comfortable mid-June overlap between Olympia and Grosvenor provided punters a fantastic opportunity to see the best of everything concurrently. American collectors and designers- ever and yet composing the financial backbone of the trade- were formerly able to spend a week in London- without having to sacrifice other summer travel plans- visiting the shows. Invariably the major salesrooms would simultaneously have fine quality sales, and, overall, punters would be confident that they’d seen and had the opportunity to make purchases from a panoply of the best that the antiques and art world had to offer.

With the demise of Grosvenor and the vicissitudes of Olympia, what we’re left with are competing fairs that effectively force the prospective visitor to choose which he plans to attend. Of course, the organizers of the new fairs have gone to great expense to provide lavish venues to attract custom, but let’s bear in mind that the organizers’ custom is to a large extent the stand rental of the dealers, who all pay mightily to participate. While all dealers appreciate the amenities put up by a good quality fair, they also know the proof of the pudding is not in the looking, but in the eating. The fair from the dealer’s perspective is entirely a numbers game- sales make the fair, and the larger the numbers of punters through the exhibition hall or marquee, the greater the opportunity to make it into the black.

My own frequently expressed belief that the internet has rendered less effective both fairs and established art and antiques venues has taken on the tone of a jeremiad. Nevertheless, I would maintain that, to counter the effect of internet shopping, the larger the numbers of dealers, the more tempting the opportunity to visit becomes for prospective buyers. Can this be accomplished in a single fair? I don’t think so. When Olympia was approaching 500 dealers, the numbers of objects was overwhelming, and tended to all run to the same (brown furniture) thing. And as with dealers, every fair has a different look and tone. Certainly Olympia, Art Antiques London, and Masterpiece have made herculean efforts to make themselves distinctive and distinct from one another. But are any of them on their own a single destination to the exclusion of the others? I’d say that Selfridge’s, Harrod’s and Harvey Nichols are each distinctive- but what would be the effect of being able to visit one and then one or both of the others only after an interval of several weeks? Under this circumstance, all would suffer.

The London Season is still in a state of flux, made the worse by a world economy that can most optimistically be described as unsettled. Still and all, condensing the fair dates to allow for a consecutive, overlapping run would  magnify the impact (read ‘positive remuneration’) of the season.

Various press reports over the course of the last couple of weeks cite a study prepared by a dealer organization to the effect that the traditional gallery model no longer works. Well, gee- come to the party. Traversing any art and antiques venue anywhere in the world and counting the ‘For Lease’ signs would probably function to give a body a strong suspicion that something is amiss.

But, then, visit any shopping street and count the vacancies. To deny a substantial linkage with three years of a weak global economy would be idiocy, but to completely lay the blame there would be at the least myopic. As with the business in fine art and antiques, the nature of retail marketing has changed profoundly, and while the state of the economy might subordinate the effect of this, it is, to my mind, such a profound and growing phenomenon that one would ignore it at one’s peril (read ‘get ready to put out the “For Lease” sign’).

Certainly anything available in multiples has the opportunity to be sold on the internet. When Macy’s offers free shipping for internet purchases, why then get in the car, struggle to park, and brave the crowds? But for those of us who sell one-off luxury items- antiques and artwork, where the collector will perforce require a personal examination of any item before making the decision to buy- there wouldn’t be any basis to compare internet activity. Or so one would think, but I must say, our internet sales now make up a significant portion of the activity of Chappell & McCullar.

That said, the bricks and mortar of our gallery space have not yet achieved an internet wrought obsolescence. What we’ve found is that for the majority of our collector clients, the initial sale is typically accomplished following the first visit to our gallery. Let me back up a bit further- the initial visit is almost invariably preceded by a visit to our website, which visit then impels the client to darken our door. Following the actual, and once the client determines that he likes what he sees, and that it accords with the online virtual, and makes that manifest by buying something from us, very, very often, subsequent purchases are made from our website. Certainly, site placement on the search engines and design and ease of use of the website are of increased importance, but for us, anyway, the maintenance of the gallery remains a critical and very central component. The net effect of this, though, is that our gallery footfall is slightly less than it was, but the percentage of those visitors who make a purchase is commensurately higher.

‘Not yet achieved an obsolescence…’, but, frankly, it is ineluctably moving that way with a small and growing number of buyers never crossing our threshold at all. We now have buyers all over the world with whom we negotiate electronically who find that it is cheaper and easier to provide us an earnest money deposit, and pay for shipping of an item that they are then able to examine on site at their leisure than it is to travel and shop. Well, of course- but this also put Chappell & McCullar on its mettle to develop a protocol to accommodate this kind of commerce. Times being the way they are, though, accommodating a new type of client is what I’d term a happy problem.

That we continue to carry on in business has some unlikely effects. One of them is that we’re inordinately targeted now by the allied trades- designers, restorers, and the like- seeking our custom, or perhaps as likely, that we might pass their details on to others. The net effect of all this is, beyond how it taxes the ability of our 8 year old server to deliver our spam email, is the time all of us in our gallery require to delete, and unsubscribe, so much of what might be charitably considered as drek.

That said, with so much of our business now electronically generated, none of us will wholesale delete and risk throwing out the serious inquiry with the spam bathwater. As a consequence, I read at least the headers and from time to time open emails I might not otherwise. Such was the case today, when I opened an email from a decorative painter, whose header cited a local designer’s project using, quoting now ‘a delightful mix of antiques and contemporary pieces.’ Well, of course, since our own gallery contains a delightful mix of antiques and contemporary pieces, I thought, in the spirit of affiliation, this email merited a quick read. I could have saved myself the trouble. The ‘antiques’ were, to put it succinctly, not, and while the mix to some eyes may have been delightful, all of what was rendered was a series of rooms fluffed up with cushions and tsatski .  That the antique pieces were more along the line of what’s now termed ‘vintage’ got me to thinking, then, about the recent rise in the use of this term and what seems its unfortunately broadened definition.

Our business is not exactly driven by etymological precision, but despite that, I’m still surprised by the inroads certain terms have made into the trade. ‘Vintage’ is one of them. From whence it has arisen, I don’t know, but it seemed to denote a piece of furniture that has some age to it, and might be of a period style but is itself not a period piece. Not so very long ago- say 6 months- this is what most people would have called ‘used furniture’, something a body might have found in a thrift store, or at a garage sale. Note that a few lines back I said ‘some age’ and not ‘antique’, as the dating of vintage pieces, as divined from the literature wherein the term was used, although fairly amorphous has never heretofore applied to anything approaching 100 years old.

Something that seems concomitant with the use of vintage pieces in design is the degree- the great degree- to which they lend themselves to being tarted up. A decorative paint finish, fanciful upholstery, and artful deployment all function to give pride of place to a piece that one might not otherwise fancy. But, then, this is where the interior designer comes in, and that is what a body ends up paying for. Time is money, and, times being the way they are, designers, should they wish to remain solvent, will scrupulously  supervise the refurbishment of a piece of vintage goods of otherwise limited value.

Was a time when, ironically, pieces of some significant value were altered by designers. Witness the predations of Syrie Maugham, whose white rooms of the 1920’s and 1930’s demanded that period furniture be stripped and ‘pickled’ in order to articulate. Certainly within an interior design context, vandalizing a period piece is reprehensible. I suppose, then, the rapid linguistic and intellectual segue from ‘vintage’ to ‘antique’ is, by comparison, less so. With all that, and in the middle age of my existence, I rather fancied thinking of myself as vintage. But ‘antique’? Now that’s reprehensible.

Can Bond Street be Bond Street without the redoubtable face of Mallett? Apparently it is going to have to adapt, as sooner rather than later, Fendi will be the new tenant of Mallett’s marquee location. Times being the way they are, it has been an open secret that Mallett had wished to shed their prestigious, but ruinously expensive, premises for quite some time. Although it’s reported they wish to maintain a showroom somewhere else in Mayfair, that location has so far not been named.

With Partridge’s very long drawn out, and very public, death throes and Mallett’s vicissitudes, Bond Street’s days as an antiques venue are numbered. But, then, the handwriting was clearly on the wall prior to the economic meltdown of 2008. Bad times functioned as something of a reprieve for all dealers in all venues around the world, as economic contraction kept encroaching luxury outlets at bay. It had occurred to me that, with the virtual shop displacing the actual, this temporary forbearance might in fact be permanent, with the Fendis of the world, selling as they do their ultra fashionable fashionables in multiples, internet buying would render less necessary the placement of a shop on- well, not on every corner, but certainly in the midst of every luxury venue.

Obliquely, that Fendi, to name one example, is back in a shop opening mode is a good thing, possibly indicating that, if not the larger economy, then at least the demand for luxury goods is on an upswing. While in the longer term, this might bode well for all of us who sell luxury goods, for the near term, though, the better capitalized luxury brands have a greater ability to renew their threat to co-opt all the limited space in the most desirable, best travelled shopping streets. For those ten or so of you who don’t know, Fendi is one of French luxury conglomerate LVMH’s many brands. With Fendi’s new, and Mallett’s old, strategic Bond Street location directly across from Sotheby’s main entrance, one wonders whether LVMH’s majority shareholder Bernard Arnault doesn’t also want a front row seat to witness what goes on at the auction house. Who knows? Perhaps fanciful, but possibly Arnault wishes to enter the salesroom business that his archrival Francois Pinault embarked upon with his acquisition of Christies in 1998.