How to determine payouts in a tournament

Updated March 23, 2017

Tournaments are a lot of fun, but the payout system is sometimes difficult to organise. Tournament payouts are commonly part of a tiered system where the winner always receives the largest payout. However, there are many ways to distribute payouts among second, third and fourth-place participants. For example, a tournament organiser may choose to award the top three winners with a lump sum. An organiser could also award payout to the winner of each tournament round. Fortunately, there are some ways to make payout organisation a little bit easier.

Decide which tournament winners will receive payout. Will the top five winners be rewarded? Will the entire payout simply go to the overall winner? Will you provide a prize to the winner of each round?

Count the total amount of prize money that you plan on distributing. If your tournament payout is based on the number of enrolment fees you receive, count the amount of prize money upon the completion of the tournament enrolment period.

Decide whether tournament winners will receive a lump sum or a percentage of the overall payout.

Choose a tiered, top-heavy payout if you plan to reward your players with a lump sum. For example, if the total payout is £975, pay the first place winner £487, the second place winner £325 and the third place winner £162.

Calculate the payout percentage for each winner if you choose to award a percentage of the total prize money. Again, if your total payout is £975, and you award your first place winner 55 per cent, your second place winner 30 per cent, and your third place winner 15 per cent, the payout would be £536, £292, and £146, respectively.

Inform your tournament participants of the payout rules as soon as reasonably possible.

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About the Author

Adela Sanders obtained her Bachelor of Science degree in environmental studies in 2008 and began writing professionally that same year. She has written environmental compliance reports for numerous American companies and is a contributor to various websites.