NASCAR Purse Money
Obviously, for a driver to win prize money in a race, someone has to put the money up for grabs. Of course, if you're a smart investor/sponsor, you're not going to offer several million dollars as a prize unless you're certain you can make several million more as a return on your investment. That's just how the game is played. But the actual cash payout NASCAR offers as a prize comes from several different places.
The single biggest source is from the television rights. Networks like FOX and NBC don't get to broadcast NASCAR races for free. They pay NASCAR a fee for the right to broadcast certain races. In return, the networks make money on advertising. Not all of that money stays with NASCAR, although a fair share does. Most of the broadcasting fee for a particular race goes to the promoters of that race, which is usually the company that owns the race track. Because the track owner has to pay for things like security and track maintenance, they keep a large percentage -- about 65 percent, according to some reports -- of the broadcasting fee to cover their expenses. A smaller chunk of the broadcasting fee goes into the purse. That's the money that makes up most of the prizes offered at a NASCAR race.
The rest of the prize money comes from race sponsors -- but just because a driver wins the race doesn't mean he or she will get all of the money the sponsors put into the purse. NASCAR purses contain what's called contingency dollars. These contingency payouts are money put in by sponsors, but the only way a driver can win it is if the team uses the sponsor's product and displays the sponsor's decal on the car. Sponsors also offer a variety of other bonuses throughout the racing season. Just as one example, Gatorade offers the Gatorade Front Runner Award to the driver who leads the most laps during the race. There are also a number of cash awards given by sponsors for things like the best strategic call during the race or the fastest lap time.
Now that you know where the money is coming from, keep reading to find how it's paid out. The system may surprise you.