The emergence of auction houses go hand-in-hand with the creation of arts markets that put a public price tag on art. Nowadays, it is often noted that about 40-60% commission goes to the auction houses to cover media, handling, publicity, auction fees, etc. So if you are thinking about consigning your art, here's a very brief introduction to what you might want to know / what it takes to list your artwork for auction:
Top 5 Auction Houses in the world: Christie's, Sotheby's, Heritage Auctions, Poly International Auction Company, and China Guardian. To locate the auction houses in your neighborhood, visit Artnet or similar directories.
For more information on the various fees that one may encounter when consigning for auction, here's an informative blog by Karen Keane. Do note that many auction houses, especially online auctions, only accept works from artists that have prior listings and auction records, creating quite the catch-22 for emerging artists.
Generally, what auction houses spend their money on to get your artwork to sell include: catalog printing, gallery exhibitions, networking/courting buyers, paying employees, media glamour, curating, valuation and basically eliminating the "friend and family rate" from the exchange so profit margins can increase. This reinforces the fact that buyers/patrons/collectors will get a better deal going straight to the source (the artist), and sellers/artists would benefit from using intermediaries to increase the value of their art.
According to Deloitte Luxemburg and ArtTactic, here are the various services that banks, art dealers, auction houses, and galleries provide. More importantly, it’s a way to gauge what kind of businesses deal with art, its change in popularity over the years, and why it might be beneficial for collectors, investors, and artists to take a closer look:
Our answer: Virtual and physical museums/galleries/art spaces can and should coexist.