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Broom’s Commitment to Power the Used Car Showroom Business with Digital Technology

Broom's Commitment to Power the Used Car Showroom Business with Digital Technology

The showroom is an equally important part of the used car buying and selling business because its function is quite vital in showing off the vehicles that will be sold to consumers.

Broom's Commitment to Power the Used Car Showroom Business with Digital Technology

This conventional business is often forgotten amidst the hustle and bustle of digitizing the automotive world. Conditions were exacerbated by the pandemic that managed to worsen car sales, which fell drastically.

SME level used car showrooms/dealers are having problems with capital and deadstock (stock that hasn’t been sold for more than a month). Slowly, the used car sector experienced an increase in sales compared to new cars at the beginning of the pandemic.

Quoting from research by OLX Autos Indonesia, last year there was an increase in the demand for used cars by around 15% -20%. The increase is actually in line with production from factories that launch new cars.

New Car Sales Targets

The latest car is itself a candidate for the business of buying and selling used cars. Gaikindo (Indonesian Automotive Industries Association) targets new car sales this year to reach 900 thousand units, up from the previous 750 thousand units.

Broom sees this problem as an opportunity to help used car showrooms by providing liquidation solutions for their used car stocks through transaction speed and integrated digital services.

This startup was initiated by Pandu Adi Laras (CEO), Andreas Sutanto (CFO), and Moch Purba Wibawa (CBO) since last year. By combining the experiences of all three, be it in digital startups, FMCG, and showrooms, it provides a deep understanding of the business and clarity on how technology can revolutionize the industry.

Pandu has been in the mobility industry since 2016, when he worked for Uber, before joining Go-Fleet. Then, Pungky is an experienced entrepreneur and has good connections in the dealership space, considering Pungky’s status as the owner of one of the largest BMW dealers in Indonesia.

“This background underlies Broom to create an ecosystem platform for every showroom business activity process starting from inventory, financial bookkeeping, and a digital marketplace, so that showroom problems can be solved end-to-end in one ecosystem,” said Pandu.

Broom's Commitment to Power the Used Car Showroom Business with Digital Technology

Broom’s Main Targets

Broom’s main target is to become a unique digital solution provider for Indonesia’s mobility ecosystem by providing a single platform for SMEs in the automotive sector to digitize their business processes.

Pandu said, the Broom platform allows SME dealers to manage inventory, financial bookkeeping, to manage their various sales instruments. “This startup aims to become a center for digitizing the dealer network in Indonesia.”

He said that, because in general, business dealers work in a very traditional way, with most of the stock counting done on the blackboard.

When trying to go online, car dealers find it quite difficult to sell on the platform and find the right buyer in their location. Financing is generally quite challenging due to the lack of documentation.

However, car dealers go to loan sharks for six-week loans because they find it marginally profitable even with the significant interest these lenders charge (estimated 8% per month). With this condition, Broom aims to provide dealer digitization and financing to empower car dealers.

In the Broom business process, he continued, the company provides three solutions for dealers to increase their business through one platform, starting from inventory management, easy stock access through the marketplace for buying and selling cars, as well as Broom Buyback and Broom Express as deadstock inventory liquidation solutions.

The two products opened up the opportunity to temporarily sell deadstock owned by showroom businessmen to Broom. Then to be bought back after profiting from the sale of the car from the capital obtained. From this scheme, Broom will get a sales margin during the repurchase process by the showroom.