1975 – 1979 From Entertainment to the Car Business
Editors Comment: Releasing each chapter the way I’m doing puts a lot of pressure on both me and the reader. If you read an entire book you would judge the book. Reading my book, one chapter at a time, makes you judge the book chapter by chapter. My point is, they all won’t be good, but I still hope you learn something. Comments are always important, even if you just let me know you read it.
When I left The Raintree, I had been out from under the corporate umbrella since 1968. That led me to believe I was no longer marketable in my old career field and I didn’t have a clue about what I was going to do. Then Howard King called me.
Howard King was the agent I would get most of my out of town talent from for the Raintree and he offered me a job as a booking agent. I had never thought of doing that and I didn’t have anything else going so I ended working for Howard for a short time. His office was in Beverly Hills right off Rodeo Road. It was a swanky location.
Before you knew it, I was a full time booking agent with a big office that had a piano in it, just like the movies. Groups or singers would come in, get on the piano and sing me a song they wrote or a rendition of an existing tune. Or they would ask me to come see them where they were playing.
It seemed like all the groups wanted to do, was play original music and we were looking for bands to play top forty for dancers. Some would agree and others would rather starve.
Howard’s was one of the old-school agents from the 1930’s and 1940’s and did he fit the part. He was Jewish and smoked big cigars and talked with the “I got just the act for you” agent speak. His only remaining claim to fame was he was the U.S. booking agent for Charles Aznavour, a very popular French singer.
Whenever Charles came to the U.S. he was automatically booked on the Johnnie Carson Tonight Show. It was then when I was behind the curtain one night watching Charles from the side. I actually didn’t like his singing, but he was/is a hell of a song writer. From what I’ve looked up he’s 92 as of this writing.
In 1998, Aznavour was named Entertainer of the Century by CNN and users of Time Online from around the globe. He was recognized as the century’s outstanding performer, with nearly 18% of the total vote, edging out Elvis Presley and Bob Dylan.
I booked some groups, but I wasn’t really happy with the job, yet there were a few bright spots.
One night someone arranged for me to go see a Blue Grass group named The Tarzan Swing Band. I fell in love with their music.
The Tarzan Swing Band was a blue grass group that was so good I booked them in Las Vegas as a lounge act for four weeks. I knew they would knock them on their ass. On their opening night, all the reports were positive and they loved them.
To my surprise, they were fired after one week. Why? For being too good. Vegas had changed by then and the lounges were open lounges. The accountants had taken over Vegas and there were only a few of the old time closed lounges available. The accountants had figured they could make more money with slot machines than free entertainment in a lounge setting. The day of the open lounge had arrived.
What happened was when the group came on everyone in sight or sound of them would stop and watch them with great applause’ at the end of each number.
At first the floor bosses thought it was cute but when the gambling slowed down they had a problem they needed to fix really quick. They fired the group. That was all I could do for them because most other venues weren’t into Blue Grass.
I had seen another group outside San Francisco, it was a trio with a chick singer that was a killer. I actually hired them as the opening act when I remodeled The Raintree. Her name was Joyce Medeiros and could give Aretha Franklin a run for her money.
Now as a booking agent I booked them into the Holiday Inn in Torrance. They were well like there and they did such a great job the Holiday Inn wanted them to open their new hotel in Santa Barbara. The night they opened a friend of mine, Adam and I drove up from L.A. and we had comp rooms.
The opening went great, we had a great time that night and the next morning we left for Los Angeles.
On the way, back to L.A. I told Adam I was sick of working as an agent and I didn’t know what I was going to do. Adam was a Closer at Vel’s, Parnelli Jones Ford in Torrance and I originally met him during the last days of my association with the Raintree.
The next thing Adam said was, “why don’t you come to work for me and sell cars?” My immediate reaction was, “Sure, Chuck Diaz the car salesman.”
The more I thought about it the more interesting the idea got. I finally said yes when I decided I wanted to find out how car salesmen had been screwing me when I bought cars. So, I said, “OK, let’s do it.”
In 1975 car dealerships were operated with one of three types of operating systems. (I thought)
This is when the salesman starts and ends the entire transaction. He picks you up when you walk on the lot. Demo’s the car you want to buy. Gets your trade in appraised and negotiates the deal with you and sells you the car. At the end of the sale he usually takes you to the finance guy.
This is the same as above but the salesman can’t sell you the car. He can only “If I could would you.”
In other words, if he could get what you want for your car and if he could sell his car to you at the price you agreed to, would you buy it today? The salesman’s job is to get you to say yes to something even if it may impossible to do it.
The document was typically called the four-square sheet. And you would sign that you agreed to the terms if he could do it. He then takes the paper you signed to the desk and the desk man pencils the deal. (usually in red pencil)
From that point it’s a test of wills and back and forth until you buy the car or walk off. BTW, if the deskman OK’s your first offer, you left money on the table.
Turn Over (TO) – Salesman, Closer
This method introduces the “Closer” or sometimes called the Sales Manager. This was the system Vel’s had. Adam was a “Sales Manager” and he had a crew of salesmen. The salesmen would pick you up on the lot, help you find the car, demo the car and negotiate some kind of deal on a “If I could would you” basis.
That means if I could get you this amount for your trade and this price for the car at these monthly payments, WOULD YOU BUY THE CAR TODAY? You would sign if you agreed and he takes the offer to the closer.
After a few minutes the salesman would then escort you to the closer’s office and he’s the one who really sells you the car.
The closer has the authority to sell the car at whatever deal he can make with you. The dealership only cares about the closer’s average gross profit for a month. On some sales, you make more profit than on others.
After I agreed to work for Adam on his team he told me it had taken him about thirteen months to become a Closer and we would see how long it would take me. Starting out as a car salesman at age thirty-eight would give one the appearance of being a loser. And I’m sure that’s what most of the people I was involved with thought of me, because the average car salesmen really were losers.
The first thing I learned was told to me by one of Adam’s salesmen by the name of Bobbie. He said, “Chuck, the first thing you need to know is you’ll make the most money selling to relatives and friends.” I asked why and he said “because they’ll trust you.”
With that advice, I started my car career and worked my way up another ladder.
What no one at the dealership knew about me was my extensive background as a Manager in the manufacturing business and systems, in charge of as many as three hundred employees.
I soon became a top salesman and promoted to a Sales Manager (Closer) with my own team. I had done it in less than a year, around nine months. I had only one BIG problem, before I started as a Closer, the owner, Vel, over rode the decision so I quit.
In 1976 the biggest car dealer in Southern California was Cal Worthington and I wanted to learn Cal’s system for selling cars. The best way to do that was quit Vel’s and get a job at Cal’s. Cal was all over TV in SoCal and working there was almost as easy as walking a sheep to slaughter.
As a salesman, you wanted people who would ask “Is Cal here?” They were already brainwashed into believing that because Cal was Ford’s largest dealership in SoCal, the prices had to be the lowest. That’s what Cal said on TV, that because of his volume he could sell for less and the sheep believed it. But Cal Worthington high grossed damn near everyone who walked on the lot.
I only stayed at Cal for about six weeks because I had learned what I needed and more importantly I was called back to Vel’s, by Vel himself. He wanted to interview me. When he earlier reversed my promotion, he hadn’t even met me, he just thought I didn’t have enough experience. I had other people there who knew I could do the job and lobbied on my behalf.
When I met with Vel I had all my ducks in order, my life, my jobs, my accomplishments, my IT knowledge, the works. After I finished my presentation called “Meet Chuck Diaz,” he was flabbergasted. It was really hard for him to overrule himself, but he did and I became the Closer with my own team.
Within about three months I and my team became number one and I did what I usually would do once I made it, I quit. The systems side in me wanted to learn more about how cars are sold. So I went looking again. I think it’s early 1976.
I looked all over for a job and got luckier than hell to get hired, as a Closer at Westchester Ford close to the L.A. airport. Westchester Ford had the fourth kind of sales system which was a TO system with a desk man who penciled the closer. In my opinion this was the best of all systems. As a closer I had a team of salesmen, but not the authority to authorize the sale. The desk and the deskman’s red pencil authorizes the deal.
At Westchester Ford, there were two deskmen who worked four closers with four teams of salesmen. I learned that all this salesman to closer to the desk man lead to a lethal selling system and a new way of handling car salesmen. At least at Westchester Ford.
Westchester Ford’s policy on salesmen was, never hire an experienced salesman. We would hire inexperienced salesmen every day from anywhere as long as they had never worked as a car salesman. An example;
I was having lunch with some friends of mine and I noticed a black kid working his ass off doing what I thought was more than required. I mean he was working his butt off. I called him over to my table and asked him if he would like to drive a brand-new car, work in a suit as sharp as the one I was wearing and make more money than he had ever made in his life.
Silly question, right? He asked me how and I explained I would hire him on the spot as a car salesman with a guarantee of one thousand dollars a month for the first three months. He turned around, took off his apron and walked out the door with me.
The policy made for eager hungry salesmen who would do anything to keep their job. This included getting lunch for the closer or desk man, picking up our cleaning or laundry or picking up our girlfriend so we could have lunch together.
As soon as a car salesman made it to number one in sales for the month, we would fire him. We didn’t want anyone there to think they were hot stuff or come close to questioning the order.
I learned not to question the desk on my first day at work. I was loving every minute and had made about $700.00 that day when I let a couple leave because I didn’t think I could sell them a car. When I went back to the desk room I sat down and the desk man asked me where the customers were. I said I let them go.
The desk was on a raised platform or dais so the deskman could look down on us. He started screaming at me.
You let them go?!!!!!”
“Come here, stand there!!!!!”
Now I can only paraphrase.
“You stupid son of a bitch, who do you think you are?!!!!”
“You let them walk?!!!!”
“You don’t let anyone walk unless I say they walk!!!!”
“You don’t let them leave the building unless I say so!!!!”
At this point I’m standing at attention and all I can think about is, “Please don’t fire me.” I said it over and over in my mind.
He went on for about fifteen minutes and then calmed down and let me off the hook because it was my first day. He was boiling mad.
I learned a huge lesson that day. I was about forty years old, I had done a lot in my life and made a lot of money and there I was, holding back tears praying that he wouldn’t fire me.
I, Chuck Diaz, the ex-General Manager, the ex-bar owner, the ex-consulting company owner, could be brought to my knees, mentally, and thank my boss for not firing me. I needed the job more than anything at that time
I stuck to the system like glue and became the best closer in the history of Westchester Ford.
The General Manager who developed this system was a hard-core car man. I can’t remember his name, but this guy was brutal and had no respect for car salesmen. That’s why he treated them like dogs. But closers were OK with him and a desk man was his pride and joy.
At Westchester Ford, the majority of the customers were black and I’m not being racist when I say the larger percentage of black people were only concerned about getting financed. They were like the people at Cal Worthington who would, “Is Cal here?” Except they would ask, “Can I get financed?”
Once we knew their only worry was getting financed we nailed them, but don’t think we didn’t nail everybody because we did. White or Black. Look at it this way, people with bad credit must pay more when you’re holding the paper.
The deal that Westchester had with the banks was called “recourse” loans. If the buyer didn’t make their payments, we had to go get the car and pay back the bank. That made it necessary to make as much as possible on all the deals.
These were the Jimmy Carter years and financing a car went as high as 24% interest. We would make a commission on the interest as well as on the profit of the car sale, so the goal was to make money at both ends. Thank President Carter for creating that situation.
After about a year the desk man who had hired me decided to retire, he was in his sixties and the long desk hours were getting to him. He told me he was going to suggest that I be promoted to the desk and wanted to know if I felt I was up for the task. I was ready and willing to take the desk to another level and the GM gave me the green light.
As one of two desk men, we split all our commission money and we got a commission for the gross profit as well as a commission on the back end which is the profit made on the interest rate we charged the customer. Example;
The people with edgy credit would get charged as much as 24%, but the bank only charged us let’s say 12%. So the profit made by the extra 12%, over a four-year contract, would be given to the dealership and we got paid a commission on that profit also.
This gave us an incentive to work both ends of the deal when working out a payment for a customer. Add that to the majority of customers whose only worry was getting financed, and you have a dealership that is setting profit records that no other dealership in town was making.
When a desk man goes on vacation, the other desk man must work the entire day for as many days his partner is gone. This can take its toll on a body, but it insured us a paycheck because we still split the commission.
When I got the desk job I bought a Corvette and moved to Rancho Palos Verdes, which is the top of the hill named Palos Verdes, south of Los Angeles. Talk about a bachelor’s pad, this was it. It was facing north and from the top of Palos Verdes, Los Angeles looked like a sea of diamonds. The north wall was made up of wide widows and a sliding glass door. When I opened the door, for the girl I brought home, I wouldn’t turn the lights on until my date could see the magnificent view.
In late 1978 I was on my way to meet a young woman for a drink at a Torrance Holiday Inn. She was very attractive and the Torrance Chief of Police was there and he liked attractive young women. He noticed her as he entered and sat next to her to engage in a conversation. During the conversation, she mentioned she was waiting for Chuck Diaz.
The Chief and I knew each other and he waited with my date until I arrived. He told her he knew me and she asked how well. His answer confused her a bit because he said, “Yes I know Chuck, you might say we are at opposite ends.”
When I arrived after the typical salutations he told me he needed to talk to me alone. As he left the bar, I followed and he stopped in the hotel lobby. He turned and said to me, “Chuck, there was a time when you could have driven down Hawthorne Boulevard drunk on your butt at ninety miles an hour and we wouldn’t have done anything to you.”
He continued with, “But today if you stopped to pick a nickel off the sidewalk we’ll bust you for armed robbery.”
That gave me something to think about.
As luck would have it and as all good things must come to an end, so did Westchester Ford. Westchester Ford was owned by a company based out of, I think, Denver. They owned about seven car dealerships in various locations and eventually became the object of a federal investigation because of the sales system. By the end of the investigation, all the dealerships were closed.
The GM kept us as long as he could because we had to get rid of all the inventory and account for all kinds of shit. He really liked me and one day he called me in and told me a friend of his was looking for a good manager.
He set me up with an interview with a man named Bill Ellis who owned a Toyota dealership in the San Bernardino area. The meeting was set for January 23rd 1979 at 9:00 AM. What a day that was.
I arrived at his dealership and was immediately ushered into Mr. Ellis’s office. He read my resume and like at Vel’s Ford, found it to be a big surprise pill to swallow. I spent the entire day with Bill, we had lunch, went shopping for shirts, went to his barber and basically talked all day long.
Unknown to me he was having me checked out by some security service and they verified all they could about my resume. They checked my arrest record, they went over me with a fine-tooth comb. At the end of the day Bill made his decision and offered me a job as General Manager of a dealership he had just purchased in Tucson Arizona.
Bill told me I had to give him an answer by the next day because if I accepted I would be on a plane to Tucson on Friday, the 26th of January. Just three days to pack it all up. I left him knowing I would accept. I had gotten used to getting paid and I needed a job. Offers like this didn’t happen every day. And then there was the chief of Police.
I met with the Palos Verdes apartment manager, a Japanese fellow that I had some drinks with on occasion. I told him I would keep the apartment until I decided if I would stay in Tucson. I was on the plane Friday afternoon.
On the plane I thought about my career in the car business to date. In less than three and a half years I went from the bottom rung of the ladder to the absolute top. I was about to become the General Manager of my own store. I was proud. That’s a good feeling.
I didn’t tell anyone I knew that I was going, I just went. I had never heard of Tucson AZ. That’s next with 1979 – 1981 Bill Ellis Datsun to General Instrument.
BTW, the black kid I hired made a lot of money, got his new car to drive, wore great suits and made salesman of the month within six months. We fired him. I ran into him a few months later and he was still selling cars and making big bucks.