Sell-through rate

What is the sell-through rate?

The sell-through rate — the share of lots in a whole sale that actually sold — is the figure telling you how many of the works offered really found a buyer. It is not about one expensive painting, then, but about whether the room as a whole was alive.

How is it calculated?

You take the number of lots sold and divide it by the number of all lots that went under the hammer. If the hammer falls on ninety out of a round hundred works offered, you have a sell-through rate of ninety per cent. A simple fraction that nonetheless says a great deal.

Why does it matter?

Because one striking record can dazzle, but the real health of the market is shown by how many works sold in total. At established houses such as Galerie Kodl the sell-through rate holds at around ninety per cent, whereas at small or new houses and purely online formats it can drop to fifteen or twenty per cent. Can you see in that figure the difference between a market in full swing and one still looking for its audience?

Can you give an example?

Imagine two auctions on the same evening. In one, at an established house, almost everything sells and the rate climbs towards ninety per cent, while in a purely online format with no tradition half the room goes unsold and the figure falls to twenty. The same works could have hung in both, and yet the outcome would look entirely different.

What should you watch out for?

The sell-through rate is also raised by third-party guarantees, that is, a minimum price agreed in advance, so a high figure need not always mean purely spontaneous interest in the room. Take it, then, as one indicator, not as sole proof that the market is thriving. When you notice not only the rate but how it came about, you are reading the catalogue with real understanding.

— Anna Pulkertová, founder of Art Part Club