Value Creation - Experience - Commitment
SUCCESS Magazine - Addicted To Success

Jerry Chamales travels a hard road to the top.
(June 2000)
by Dina Ingber Stein, Success

Gerald “Jerry” Chamales didn’t have the kind of resume that inspires confidence. At the age of 26 he was a street bum: addicted to drugs and alcohol, sleeping in homeless shelters or crashing on a friend’s sofa. He spent six months in a psychiatric hospital. Today, Chamales, 48, is president and CEO of a $35 million company and lives in a mansion just down the block from the site of O.J. Simpson’s former Brentwood estate. Here’s how the fairytale unfolds. In 1977, with the help of an addiction recovery program and a few good friends, Chamales was determined to turn his life around. He got a job with a small telemarketing firm selling computer printer ribbons. “I was so committed to rebuilding my life, that I worked harder than anyone else,” he says. “I read books on sales techniques, listened to motivational tapes. Within a year I was the top salesman.” That first taste of success ignited a desire for more. Believing he could run this business better than his employer, Chamales took the $7,000 he’d saved from his job, rented an office, and launched his own telemarketing firm. It was a disaster. “I just wasn’t ready. I didn’t know how to run a company,” he says. “I had too many expenses. I was so scared that I couldn’t even lift the phone to call customers. Within a few months I’d burned through all my savings, and I was $1,200 in debt.” On the advice of a friend, he decided to start over—on a much smaller scale. He set up shop in his tiny Venice, Calif. apartment with just an $80 laminated table and a telephone. This time, he told himself, “failure is not an option.” He named his company “Omni Computer Products,” because it sounded impressive. “There was an Omni magazine and a car named Omni. When I called people and said, ‘I’m Jerry Chamales with Omni Computer Products,’ they thought I was a big outfit.” His idea was to market the same kind of product he’d been selling in his previous job. “The computer industry was fairly new back then. I looked through some industry publications and found only three or four companies producing IBM-compatible impact printer ribbons. I called them all. One turned out to be a guy who was just starting out in business himself. We needed each other. I guess it was propitious.” When Chamales closed a sale he would pass the order on to the supplier, who would put the Omni label on the products and then ship them out. The supplier gave Chamales 40-day payment terms, while Chamales gave his customers 30-day terms. That gave him some liquidity. “I didn’t spend until I absolutely had to. I used credit cards for living expenses and to float the phone bill.” With no inventory and virtually no overhead, he was able to pay off his debts and move into the black. For the first five years, he paid himself only $200 a week. Chamales would make 75 to 100 calls a day, convincing corporate customers that he could provide the same quality product as the big name brands at lower cost. Within a few months he was doing well enough to hire some telemarketers. In less than a year, he’d moved into a larger apartment. By the early ‘80s, Omni was a multimillion-dollar company. Chamales decided it was time to expand and manufacture his own products. Today Omni produces OEM-compatible inkjet and laser toner cartridges, all of which are sold under the brand name Rhinotek. There are several unique aspects of Jerry Chamales’ story that have undoubtedly contributed to the success of Omni. The first is his hiring practice. About one-third of Omni’s 200 employees are, like Chamales himself, recovering substance abusers recruited from recovery centers and half-way houses. “These are people who really want to succeed. They’re highly motivated,” he says. He takes special care of these employees, putting them through intensive training, providing them with in-house mentors, even lending hundreds of thousands of dollars to help purchase cars or homes. That’s not to say he hasn’t had problems, including death threats from one thieving worker he fired. He has since learned to screen potential employees more carefully, giving them a psychological profile test. As a result, he says, these employees have a 15 percent first-year retention rate. That may not sound impressive, but in the telemarketing industry, it’s unusual. “In sales jobs, it’s not uncommon to have 200 percent turnover in the first year,” says Gene Gray, former president of the American Teleservices Association. Chamales’ move into manufacturing is also unique among telemarketing firms, says Gray. For Chamales, though, it was just one more step on his road from addict to entrepreneur. He now retails his product, has a new call center that will accommodate an additional 350 salespeople, and intends to start marketing on the Web. He expects sales to reach $220 million by the year 2002. “It’s not where you start in business,” says Chamales. “It’s where you finish.”
Dina Ingber Stein is a freelance writer with more than 20 years of experience writing for magazines. She is based in New Jersey.