Australian Bailey O'Malley, the only foreign artist resident in Dafen, plans to open more galleries in China. [Liu Lu / China Daily]

Foreign entrepreneur makes heads turn in Dafen with popular art gallery

Looking out through the top floor window of his five-story art gallery in Dafen, an urbanized art village in the manufacturing hub of Shenzhen, 44-year-old Bailey O'Malley says that he wants to sell more paintings in China.

As the only foreign artist resident in Dafen, O'Malley owns Pix2Oils, one of the leading fine art galleries in what is also considered the largest oil painting production base in the world.

But the ambitious Australian artist and entrepreneur is not content with being successful in Dafen. O'Malley wants to have a presence in all the major Chinese cities, as he believes China to be the fastest growing consumer market in the world for oil paintings.

"It's not just because of the global financial crisis. The number of affluent people in China has been climbing steadily and so also the purchasing power. The potential is enormous especially if every one of the 1.3 billion people in China buys a painting," O'Malley says.

Though he has the poise and confidence to talk about business expansion, O'Malley admits that when he came to Dafen five years ago he never expected to work out the way it did. "I was an amateur artist for more than 20 years and decided to start an art-dealership in Dafen after being inspired by a television program on the village.

"In all these years, I have never came across any other place like Dafen for art," he says.

"Though there are clusters of artists and art colonies in many countries, none of them are organized in a commercial way as Dafen is. Villagers sustain themselves financially by selling their artworks and their business has been steadily growing. It is truly amazing."

According to O'Malley, the best thing about Dafen is the advantage to draw upon the skills of a host of artists and use it to sell the paintings rather than focus on just selling his own works.

"If you want to buy five paintings for your house, it is better to go to Bali or Vietnam, and buy them for $5 (3.6 euros) apiece. But if you want to buy 5,000 paintings, you have to come to Dafen as only it has the production capacity to handle such large orders. That is also one of the reasons why I'm here."

Starting with only $50,000, O'Malley's gallery has turned into a successful enterprise with profits of over $1 million last year.

Going by the current trends, the gallery is expected to notch up a 30 percent growth in profits this year.

Along with robust sales, O'Malley has also won several lucrative contracts from Broadway producers for stage backdrops. He is also the biggest oil painting supplier for casinos in Las Vegas and Macao.

Although many of his paintings are shipped overseas, he believes that the future is in China. His recent sorties to the US and Europe have convinced him that affluent Chinese are the best bet for expensive oil paintings.

Pix2Oils sells 6,000-10,000 paintings every month, with roughly half of the stock purchased by luxury hotels in China.

"The number of orders from hotels in China has surpassed those from the US and Europe, because China has been building four- and five-star hotels recently."

Apart from the wholesale to mass market, O'Malley also plans to retail more oil paintings, which are traditionally regarded as "high art" and the preserve of the elite, to the homes of more ordinary Chinese people.

"If you watch the Chinese soap operas, you can see Mercedes cars, beautiful houses, and expensive oil paintings on the walls in most of them. Oil paintings are now being seen more as a sign of class and distinction, and that to some extent is what is going to drive demand in China."

Obviously, O'Malley is prepared for the growing demand. He has put in a lot of efforts to understand Chinese preferences while selecting oil paintings and wants to make retailing for the high-end market his core business.

"It will be more profitable to sell retail to rich Chinese than to sell wholesale to hotels in the US," he says, adding his retail business in China has grown by an amazing 300 percent every year.

But O'Malley says there is one factor that differentiates Chinese buyers from Europeans and Americans. They (Chinese) prefer original paintings instead of copies and consider paintings more as feng shui.

"If a Chinese wants to spend a lot of money on a painting, one of the main considerations is how the painting represents his financial situation," he says. O'Malley says that by incorporating the finer aspects into his paintings, he has been able to attract more Chinese buyers.

As part of his business expansion, O'Malley has roped in over 250 professional artists from art institutions across China to create high quality original masterpieces.

Besides, he has also brought in more paintings drawn by Australian, European and Russian artists. "Some Chinese buyers are keen to spend more on overseas paintings."

O'Malley plans to open a new art gallery in Shanghai next month, for the high-end clientele. He also plans to open galleries in other major Chinese cities over the next three to five years.

"A lot of the galleries here are racing to the bottom, and striving to be the cheapest. That's not my plan and my aim is to be the best," he says.

At the same time, he admits that it is not easy for a foreigner to do business in Dafen, as the profit margins are thin due to the intense competition. "So in order to survive, I have to find ways to be better than the others," he says with a chuckle.

But for Dafen residents, O'Malley is not just a foreign resident, rather he is someone who has brought in an advanced business model and good after-sales service from Australia.

Unlike the casually dressed salesmen in other galleries, the 30-odd staff members at Pix2Oils are all dressed in uniforms and speak good English. There are always smiles on their faces, and they strive to offer the most attentive service among the 1,100 galleries that dot Dafen.

"We hope to attract more original artists and art dealers from abroad to Dafen, because people of different cultural backgrounds will inevitably diversify local culture. This is not only helpful to stimulate inspiration but will also prompt local artists to improve their outdated business models," says Peng Gang, director of the administrative office of Dafen village.

O'Malley has no plans to move his business out of Dafen and is optimistic about his business prospects in China.

"There are many villages in China that are trying to emulate Dafen. But Dafen does not have any role models or success stories to emulate. The people here believe in being trend-setters," he says.

"Despite the fierce competition, you can win the race if you do just 1 percent better than others."