Expected Payout to Entry Fee Cost

[toys4dlr]

Ok, I have been wondering what others consider when evaluating the cost vs. Potential ROI on a comp.

I know that the promoter is taking the risk as they have to guaranty a payout in advance of the event. But I have been noticing, as the size of the fields are growing the payout have not always been increasing too?

That is to say, if it is originally anounced as a $10,000 guaranty event, with the entry fee on average of 250. Now the event grew to 70, that is $17,500 in entry fees only. Then add in the sponsor money and such. I have seen that they stick with the original payout or close to it and it becomes not that great of a potential ROI.

I would assume that the Sponsors money should cover the overhead and the promoter should be able to make money too. Why do it if you can't make it a win-win situation. But I should have a shot at more that 60% of overall entry fees.

What have others been seeing or am I way out in left field????

[Crash]

We never enter a contest expecting to make a ROI on the competiton side of things. We simply arent consistent enough to expect to make money competing. On the other hand, as you know Dave, out here in AZ we area allowed to do People's Choice (PC). If we see that a contest has the potential to attract a large crowd, we will attend expecting to make a large score just doing PC. Anything won after we make our PC $ is just icing on the cake.

As far as entry fees go, we would find it difficult to accept paying over $300 per contest.

That's just my take.

[tmcmaster]

Well, there are a bunch of other ancillary fees for the promoter as well. Insurance, security, EMT's on site, the cost of power/utilities. It eats up profit quick.

[Divemaster]

Also, remember that the amount announced on the KCBS site is the ‘Guaranteed’ minimum payout and the final amount can be more…

[G$]

Originally Posted by Divemaster

Also, remember that the amount announced on the KCBS site is the ‘Guaranteed’ minimum payout and the final amount can be more…

Dive, that is the point of the OP, I think.

In other words, what can be expected when more teams sign up than were "expected" or forecasted? (How much) should the prize pool grow above that stated guarantee? At the end of the day, what is the expected ratio of entries to payouts for you as a competitor?

I have been thinking about the answer, and I am not sure I know what my own opinion even is. On the surface, it seems we are to the point where 1:1 is reasonable for just about any contest, as a baseline.

[toys4dlr]

Thanks G$,

That is what I am trying to determine. I understand that the payout can not go down from what is submitted and it can go up. However, I am not seeing too much of the increase, when the event gains popularity.

Crash, I understand what you are saying about the PC, but that it seperate to the payout of the overall event and not available at all events. I was specifically wondering about the prize fund.

[Sawdustguy]

Originally Posted by toys4dlr

Thanks G$,

That is what I am trying to determine. I understand that the payout can not go down from what is submitted and it can go up. However, I am not seeing too much of the increase, when the event gains popularity.

Crash, I understand what you are saying about the PC, but that it seperate to the payout of the overall event and not available at all events. I was specifically wondering about the prize fund.

I am being totally honest when I say you are sounding a little greedy. A contest that pays $10,000 with a $250 entry is not the norm. Entry fees of $150 to $225 with a payout of $5,000 to $7,000 here in the northeast is. There were a number of contests that didn't happen in the past few years simply because they weren't making money. There are also quite a few contests held in the name of a charity. In the case of a charitable contest put youself in the place of the charity. You advertise a contest with a purse of $10,000. You have more teams sign up and a have a chance to make a little more money for the charity. If you have the chance to make more money for a charity are you going to give it away to someone else? My bet is no.....

[G$]

Originally Posted by Sawdustguy

Put youself in place of a promoter. You advertise a contest with a purse of $10,000 and it is a charitable contest. You have more teams sign up and a have a chance to make a little more money for the charity. If you have the chance to make more money for a charity are you going to give it away to someone else? My bet is no.....

Guy,
It would probably even vary on a case by case basis. There are valid points, in each scenario, on both sides of the equation.

But here is a point blank question:

Would you sign up for a contest not funding the prize pool at a 1:1 ratio in the first place?

Would you expect a contest with a 'guranteed' 1:1 ratio, to keep that ratio if a significant increase in teams signed up over what was 'expected'?

(I'm not sure what the answers are, but it is a worthwhile question to think about)

[Sawdustguy]

Originally Posted by G$

Guy,
It would probably even vary on a case by case basis. There are valid points, in each scenario, on both sides of the equation.

But here is a point blank question:

Would you sign up for a contest not funding the prize pool at a 1:1 ratio in the first place?

Would you expect a contest with a 'guranteed' 1:1 ratio, to keep that ratio if a significant increase in teams signed up over what was 'expected'?

(I'm not sure what the answers are, but it is a worthwhile question to think about)

Firstly, I edited my post while you were posting so it is a little different. Ok, I usually don't enter a contest worrying about the prize money. We are not the best cookers in the world (we only won a couple of RGC's and had a number of walks but have never won a GC). We enter contests that are geographically convienent and that were fun in the past. My brother and I compete as a family, and for us, it is truely a family event. Every one from our family that attends participates in one way or another. It is part social event. Because of why we cook, it is difficult to answer your question.

If we won a few contests my answer may be a bit different but not a lot. If we won I don't think that I we would enter contests with a better payout to begin with. A purse of $10,000 is not common here in the northeast. If the purse was advertised at $10,000 and a number of extra teams showed up I don't think I would expect the prize fund to be upped for that contest but I would expect next years contest to have a better prize fund. Again, this is honest speculation because of our viewpoint. If the contest was for charity, I could not care less because I would want to see the charity benefit as much as possible. I hope that answers your question.

[The Pickled Pig]

I wish more contests would payout 100% of the entry fees in prizes. If they want to make money for the promoter or charity that's great, just don't do it on the backs of the cooks. As several contests have demonstrated, you can have a financially successful event and still return 100%+ entry fees in prize money.

For me personally, I don't care about the organizers' finances, whether for profit or not. With a few exceptions, potential prize money plays a part in forming our schedule. We couldn't have competed in nearly as many contests as we did the last few years without it.

[Rich Parker]

Seems like the events that are ran by charities should give out receipts of donations if the entry fees exceed the payout.

[Gowan]

Originally Posted by The Pickled Pig

I wish more contests would payout 100% of the entry fees in prizes. If they want to make money for the promoter or charity that's great, just don't do it on the backs of the cooks. As several contests have demonstrated, you can have a financially successful event and still return 100%+ entry fees in prize money.

For me personally, I don't care about the organizers' finances, whether for profit or not. With a few exceptions, potential prize money plays a part in forming our schedule. We couldn't have competed in nearly as many contests as we did the last few years without it.

Yes there are a few contests that generate major revenue from public admission and sponsors, but these are in the minority. There are many other fund raising activities that require a great deal less work for a higher return.

The majority of BBQ competitions are glorified private parties for the participants. As the primary beneficiaries of the event, I strongly disagree with the sentiment that organizers "make money on the backs of the cooks". The truth is that we who cook and judge need the organizers a whole lot more than they need us.

[Divemaster]

Should payouts be raised when the number of teams increases? It would be nice but I’m not expecting it.

Do I use the initial payout information to select comps? Normally, but not always. Example, there is one small comp this summer (Poorque) that the entrance fee is $80 and payout is $70 (no, this isn’t a misprint). Why would I go to this comp? Let’s see, it’s got a governors proclamation, it’s not far from my house, and I figure that with such a low entrance fee, there are going to be a bunch of new teams that this is going to be their first comp and it’s a chance for me to pay back for all of the help I got when I first started.

Trust me, the money is nice, but how many of us can afford to make it our job?

[Alexa RnQ]

Conversely, if not many of us can make it our job, then how few of us can afford to fund our hobby exclusively out-of-pocket without considering the payout schedule?

[Scottie]

Dive, you don't think it waters down the other WI contests? I know I'm not going to any of them... until after Labor Day.

Honestly, nothing against my friends cooking in WI this summer... But I really hope some backyarder wins the Jack draw...