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Further Fees and Hidden Costs at Design Competitions

Further Fees and Hidden Costs at Design Competitions

All design awards, competitions, and contests, whether free to join or not, imposes costs on the participants. Learn these costs and how to avoid them.

It must be noted that most of the free to join design contests indeed are the most costly ones. Free design contests are the most expensive because in most cases the designer is required to transfer the rights regarding to their designs to the contest organizer in exchange for a trivial award sum. Furthermore, we should account that only one in fifty participants win such design contests, and when we also consider the fact that winning such contests do not create any publicity, fame or prestige to their winners, we could say that taking part in design contests are rather very costly, and this costs are almost always overlooked by the participants.
To repeat once more, because it is important, the biggest cost for taking part in free to join design contests is regarding to the design rights. In most cases, designers could lose legal rights to their designs as it could be required by the terms and conditions of the free design contests. The second economic cost is the time; since free contests usually require designers to submit a design based on the brief of the organizer, they require more time than others and when we also consider the proportion of winners and the offered award prizes, we could conclude that they do not generate positive economic returns to participants. However, we should also note that they could potentially help very young designers to create their portfolio.
The least costly design competitions (for participants) are those organized by the governments or government level initiatives, where participating designers are neither required to transfer their designs, nor to make further payments. Furthermore, in most cases there are also no fees for taking part in design competitions organized by governments, making them attractive for participants who would not have the finances to join international design awards awards. It is true that when compared to international design awards and competitions, they provide less publicity and therefore less international recognition, and it is true that they too require substantial afford to join by submitting a good design which is indeed an economic cost but still, government level design competitions provide one of the most returns to participants in the competition landscape. The major issue regarding them is that they are not always available for specific design categories, and indeed they could potentially cost much more than any other awards but such fees are paid by the general public instead of the participants as a part of the government budgets.
From another perspective, It is a great prestige to win famous design awards and competitions however there are several issues that participants must definitely look for when especially joining the most prestigious international design awards and competitions. Indeed, it is not just the participants who must be careful; but patrons (institutions providing patronage) as well. Many design awards and competitions which position themselves as “free to join” events require designers to pay further fees to claim their awards or to get the advertised benefits such as being included in the publications, meanwhile when such awards apply for patronage, they position themselves as “non-commercial events”.
However, the most common issue in international design awards and competitions is the fact that most of these awards do require both application fees, extra costs and further fees. Application fees (also called submission fees, nomination fees or participation costs) are indeed necessary to exist since a form of revenues must exist to make these events sustainable, however “further fee” schemes or “extra costs” could create potential issues.
Further Fees for Winners clause exists for most of the awards, and such clauses are usually passively communicated under the competition terms and agreements. The further fee for winners means that once a participant wins these prestigious design awards, the winner designer is required to pay the further fee indicated in the competition terms before the winners could claim their award status. These further fees could go up to thousands of euros and they are required to be paid shortly after the potential award status is communicated.
On the other hand, some competitions break up the “Further Fee for Winners” into several items such as the: “Exhibition Space Fees”, “Licensing Fees for Winners’ Logo”, “Press Release Fees”, “PR Package Fees”, “Gala Night Fees”, “Table or Chair at Winners’ Dinner”, “Award & Certificate Fees”, “Trophy Fees”, “Yearbook Publication Fees”, “Yearbook Preparation Fees”, “Yearbooks” etc and any taxes are shown to designers at the last minute. Designers are suggested to read the competitions’ terms and agreements to understand or avoid any further fees before joining events.
From the value added tax perspective, it could be understood that most of the international design awards do indeed target not designers but rather companies as potential participants; i.e. this is based on the fact that value added tax is added last minute; however most laws require that if the “product” is intended for consumers i.e. designers, value added tax must be included prior to checkout, the only condition that value added tax could be shown or added last minute is if the “product” is not for ordinary consumers but rather other companies; i.e. B2B services.
Furthermore, “Further Fees” that could reach up to five thousand euros, are obviously not intended for designers; i.e. for companies such fees are little or non-relevant, however for a young or upcoming designer, the “further fees” are an issue. Many famous international design awards will cancel winners’ winning status if these “further fees” are not paid in a timely manner, and many designers do fall into this situation as they do not read the terms and agreements in advance where this information is already stated in small fonts.
The problem with the further fee schemas is because they create an incentive for award organizers to entitle awards to the greatest number of possible winners as each winner is a further profit. This not only decreases the prestige of such awards but also could potentially lead to less qualified designs to be declared as winners, if the further fees are paid. Meanwhile, for example A’ Design Award and Competition does not require any further fees from the winners and this is actively communicated to the public. Since there are no further fee requirements from winners, each winner is a further cost for A’ Design Awards; and therefore it is to their interest not to award any entries that are not actually worth it, making the event more prestigious and fair.

This article was added on Monday, 27th of January, 2014 at 05.26 am by author Onur Cobanli Tags: competition hidden costs, further fees for awards, economic cost of competitions. Read our copyright policy here.




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