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Making the Most of Every Win
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Contingency Programs Can Put Dollars In Your Pocket.
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By Jim Samuel, www.dragracingaction.com |
Not many people would give up 90 percent of their paycheck every week, but that's exactly what drag racers are doing when they don't take full advantage of contingency sponsorship programs. What began years ago as a group of manufacturers just looking to reward their customers for purchasing and winning with their products, has grown into a multi-million dollar program that has almost taken on a life of its own. If you happen to race a steady diet of either NHRA or IHRA races, you'll have noticed how the actual cash payout is rather small for an event of that stature. To bring the purse money in line, sanctioning bodies actively pursue manufacturers who are looking to promote their products through a contingency program.
The concept is really nothing new, and involves a manufacturer paying a winning racer a certain amount of money that is contingent on the racer purchasing and using their product. Decal display on the side of the car is also a requirement, as is sometimes the signing of an advertising waiver. And then there are the non-contingent programs, such as the Perfectly Strange Award given out by Strange Engineering. Whenever a person runs dead on his dial or index during an elimination run at any of the NHRA national events, in the Super Stock, Stock, Super Comp or Super Gas class, they receive a check from that company. This is non-contingent , simply because it only requires the display of their special Perfectly Strange decal. Should the competitor have any of the products that Strange does post contingency money for, the check amount is doubled. This is a very easy program that a racer can benefit from and not even cost them a dime. Sure, participating in the programs takes some work. You'll have to put manufacturer and product stickers on top of that expensive paint scheme. You'll have to keep track of receipts and serial numbers. You‘ll even have to go through another inspection at the end of a race. But when you win, those stickers can increase your take home pay by up to a factor of 10. “If you're going to drag race as a business, you have to participate in contingency programs,” says Skooter Peaco, Director of Race Operations for the International Hot Rod Association (IHRA). “If you're going to do it for a living, it's impossible not to participate.” That's precisely why Dan Fletcher's Stock Eliminator 1969 Camaro and Super Stock 1969 Camaro are both covered with contingency sponsorship product stickers. Racers like Fletcher, who earn their living at the track, depend on getting the most from the contingency programs. “There are some people who have a lot of money,” Fletcher says of racers who don't take advantage of contingency sponsorships. “But for others, the programs are vital. “Purse money is negligible,” Fletcher says, adding that the vast majority of his racing income comes from contingency sponsors. “You're paying a $200 entry fee and you're racing for a $1,500 purse, which doesn't make good sense” he says. “But you can make $18,000 to $20,000 with contingency sponsorships (with a national event win).” Fletcher admits that it takes some effort, but that he works on his contingency program throughout the year, from identifying contingency sponsors before the season starts to following up at the end of the year with those who are slow making payments. “You need to do your homework like anything else,” he says. “You have to fill out the forms, you have to register for the programs and you have to make sure you bought the product and are using it,” he says.
Manufacturers offer the contingency programs for a number of reasons. “It's a mutual benefit program that supports the racer and the manufacturer,” says Ted Keating, general manager of Dart Machinery in Troy , Michigan . “Our goal is to support racers and get more feedback from them.” Keating says that , in addition to the exposure that Dart receives through the contingency program, racers who participate in the program are more likely to offer the company feedback on its products. “At the end of every year, we get letters from racers thanking us for offering the contingency program and telling us how they're using our products, how they're working and making suggestions on how we can make them better,” he says. Dart has had its current program in place for eight years. “We've always supported a contingency program as a way to support the racers,” Keating says. Tracy Winters, vice president of sales and marketing at J.W. Performance Transmissions in Rockledge , Florida , says that feedback is an important part of her company's program as well. “You can be there at the track, have access to the racers and communicate with them,” she says. Winters says that J.W. Performance Transmissions has offered a contingency program for more than 20 years and has been very successful. “We'll closely monitor the program every year to see how much of an effect it has,” she says. “And we'll be looking to see if we want to add other products to the program.”
The bottom line is that contingency programs help manufacturers sell products. Almost every company produces quality equipment, so when I'm evaluating products, I'm certainly going to choose the one with the best contingency program,” says Fletcher. “If a new company comes up and posts a contingency offer, I'm going to try to buy that product.”
IHRA's Peaco says that lack of preparation is the biggest mistake racers make with contingency programs. “The biggest thing that I see is the lack of the appropriate decal,” he explains. In addition, he says, racers should make sure that they have the stickers they need before they get to the track , and make sure the stickers are in the required location on their cars. “A lot of racers assume that every decal that he or she might possibly need will be at the tech trailer. That's not always the case,” Peaco says. In some cases, manufacturers may limit availability of their stickers to only registered users of their products. “There are some sponsors that require more than a decal,” says Peaco, and racers should be prepared to meet those requirements. “Some companies may require racers to register their purchase or provide a serial number or other proof of purchase of the product they are using. One motorhome manufacturer requires racers to submit photographs of their vehicles on the racetrack property,” Peaco says.
The additional requirements are designed to make sure that drivers who claim contingency awards are actually using the products, Peaco explains. “There are only so many parts that we can visually inspect.” At J.W. Performance Transmissions, for example, racers have had to include product serial numbers with every award claim they submit. The company is working to introduce a new Internet-based system that will allow racers to register and provide a serial number at the beginning of the season.
“We're trying to make it easier for racers to fill out the forms,” says Winters. She adds that while the company requires serial numbers from racers, it relies on the sanctioning bodies to ensure that the proper product stickers are in place. In contrast, Dart Machinery, as well as other companies, relies on its own representatives, who attend national events, to keep track of the program.
Peaco says that the sanctioning bodies take their role as contingency inspectors very seriously. “There is no gray area. Either you have it or you don't,” he says. “If we are not black and white about it, there won't be any contingency programs.” Racers are responsible for knowing the requirements of each contingency sponsor. “Ignorance is not an excuse,” Peaco says. “You wouldn't go to a tech inspection without knowing everything is correct. Contingency inspections are no different.” Decal “slapping” is another area manufacturers have little regard for. Decals must be on the side of the car for the whole event, and there are companies that will take the time to walk through the staging lanes before the first round, taking notes as to which cars have their decals and which don't. Typically, only the winner and runner-up are eligible for awards, but that doesn't mean you “slap” on the decal just before you're pulling into the water box for the final. If you do, the manufacturer has the right to refuse payment, based on the fact that you didn't hold up to your end of the agreement. Racers who want to take maximum advantage of contingency sponsorship programs should check the sanctioning body websites in early February to see what is available to them. The NHRA contingency web site is www.nhra.com/sponsors/contingency.html , and the IHRA web site can be found at www.ihra.com/contingency.htm. Most sponsorship programs are in place by then, according to Peaco, though racers may want to check in throughout the season to see if new programs have been added.
“Every issue of the IHRA magazine, Drag Review, contains a list of contingency sponsors and an up-to-date contingency sponsor sheet is included with the information packet that every driver receives at an IHRA event,” says Peaco. In addition, adds Fletcher, racers should check to see if the contingency requirements include an expiration date. “Some of them only pay you for two years or so (after a purchase),” he says.
After racers have identified the programs and purchased the qualifying products, they should make sure they are ready to meet all the requirements at each race they enter. That's why Fletcher is unconcerned with contingency inspections after a win. “This is the way I make my living,” he says. “If I claim something, you can bet I bought it, used it and have done my homework.” That homework doesn't end at the end of the drag racing season, Fletcher added. “At the end of the year, there are always a couple of payments that I have to track down,” he says. “You'd like to have everything wrapped up by the end of December.” Peaco says that he's seen racers leave a lot of money on the table, either by not following the rules or by not participating in the programs. At the IHRA national event at Maryland International Raceway in September 2003, one of the winners had a car with absolutely no product stickers on it, Peaco recalls. “He looked at me and said ‘I guess I just threw away $8,000.' I just nodded and said ‘Yes, you did'.” “I understand it ,” Peaco says. “When I got my new car, the last thing in the world I wanted to do was put stickers all over it.”
But unless you've recently won the lottery , or have a rich uncle who is willing to finance your racing efforts, chances are that you're going to be slapping product stickers on your car sooner or later. Contingency programs can add thousands of dollars to your bank account every time you win a race. A ll you have to do is take the time to plan ahead and make sure you're prepared every time you pull into the winner's circle.
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