A DETAILED survey of the relationship between antiques dealers and their banks has highlighted a serious breakdown in communication and little inclination on the part of the financial institutions to understand the special nature of the antiques business.
LAPADA, the Association of Art and
Antique Dealers, conducted the survey in advance of their annual
conference in London on February 28, when a panel of specialists
will address the problems raised in the survey. Dealer delegates
will make their own contributions to the debate on the best ways to
get more out of the banks during a recession.
Key findings in the survey include the
• 45% of respondents felt that their
bank did not understand the nature of the antiques business well at
all. A quarter felt that their bank had only a slight
understanding, though a further quarter did think that they
understood the business moderately well. Only six per cent said
their bank had a very good understanding.
• Just under a third of respondents
said that they had been subjected to unreasonable demands for a
loan or overdraft, with only 23% saying they understood how the
bank assessed the value of their stock when establishing credit or
finance ratings. Some dealers said banks accepted their own
valuations of their stock, but many others commented that the banks
did not take stock value seriously as an asset. As many as 58% said
they thought that their assets had been undervalued.
• Perhaps surprisingly, dealers were
fairly evenly split when it came to evaluating their relationship
with their bank manager. Overall nearly 48% were satisfied, while
just over 46% were dissatisfied. Only 7% said they were very
satisfied, but a significant 25% admitted that they were very
• The majority of dealers thought
banking services had deteriorated over the past ten years. Nearly
67% said business support was worse and over 60% said that personal
services were worse.
Perhaps the most revealing section of
the survey asked dealers to suggest improvements to the service
they received. Dealers considered that young (and constantly
changing) teams of 'relationship managers' were no substitute for
old-style bank managers with the experience to assess clients and
make decisions. At worst, 'relationship managers' seemed incapable
of deviating from a set script designed to sell further
A number regretted that current
banking practice seemed not to take notice of past business
As one dealer remarked: "All I would
really ask is: a) an acknowledgement that if I have kept myself for
25 years, it might indicate that I have a rough idea of what I am
doing, and b) … that I have never yet promised anything and not
delivered. I have never gone broke (which is once less often than
There were many calls for banks to
take the time to understand the nature of the art and antiques
business, but there were also acknowledgements that dealers were
not the only small businesses having trouble communicating with
their banks. Many self-employed and small high street businesses
face the same problem of being categorised as high risk, it was
One dealer wanted to know how antique
dealers could present themselves and their business in a way that
banks can understand: "Don't forget the average bank manager finds
it difficult to grasp the notion that most of our stock is paid for
before re-sale; hardly Tesco is it! Add to that the fact that a lot
of stock is bought in anticipation of a sale, not for a definite
sale, and the problem for bankers compounds itself.
"There are, however, positives, which
banks would love to hear. A lot of stock is cheaper to buy than at
any time since the early 1970s and interest rates are incredibly
low, therefore enabling the astute dealer to buy a lot more for
less," they reasoned.
This is the approach that the LAPADA
conference will take. The association's chairman Lord Chadlington
will chair a panel of bankers, business advisers and financiers to
explore the way that banks view the trade and how best to present a
good case to them. They will also advise on what to do when things
go wrong and explore other ways of financing a business.
Following feedback from last year's
event, this year's conference will allow more time for
contributions from the delegates themselves, and a second panel
discussion, chaired by Mark Henderson, director of Walpole, the
British Luxury Trade Association, will explore the place of art and
antiques in the luxury marketplace.
After lunch, Lord Chadlington will
chair an open forum debate, inviting participants to draw upon the
skills of ATG editor Ivan Macquisten on the power of PR, silver
dealer Daniel Bexfield on successful viral marketing campaigns, Ron
Archibald, director of the Trade Access Programme at UKTI, on
trading with emerging markets, Carmine Bruno, MD of Online
Galleries, on selling antiques online, and LAPADA chief executive
Sarah Percy-Davis on current trade issues.
LAPADA have made ten places at the
conference available to non-members who want to join in the various
debates. However, those interested are advised to book early as any
LAPADA members who have not already booked will also be able to
take them up.
The conference is held in association
with Antiques Trade Gazette, Cadogan Tate and Besso Limited and
will be held at Goldsmiths' Hall in the City of London. With
participation limited to 80 delegates and a cost of only £55 +VAT
for the day, including a three-course lunch, demand is expected to
be high. Applications should be made as soon as possible to LAPADA
on 020 7823 3511.