Lecture Prepared for:
World Chinese Muslim Trade And Culture Forum & Exhibition, MINES, Malaysia, 20-22 May, 2010
1.1 The “Halal Spaces” in the Western Countries
In the recent years, World Halal food manufacturers had been putting a lot of attention to the Halal acceptance in Britain as there were conflicts over the provision of Halal in schools, especially in the politics of religious slaughter and the marketing of Halal meat. In many parts of London such as Finsbury Park, Edgware Road, and Whitechapel Road, Halal is a distinctive presence on signs and in butcher shops and restaurants. Lately, more and more types of Halal-certified products are appearing in supermarkets such as Tesco and ASDA.
In the contemporary London, the term of “Halal” is no longer an expression of esoteric forms of production, trade, and consumption. Global Halal market is a huge and expanding globalized market. A Canadian government statistical study reveals that the global Halal trade annually amounts to $150 billion, and it is growing among the world’s approximately 1.3 billion Muslims. It is said that the transformation of living standard and lifestyle of the Muslim and non-Muslim ethnographic did showed that the proliferation of modern “Halal is everywhere” in the western countries.
In order to prevent Haram in Malaysia’s Halal market, the local and foreign producers and traders are encouraged by the Malaysian government to apply for JAKIM (Department of Islamic Development Malaysia) Halal Certificate. DagangHalal.com as JAKIM’s strategic partners is carrying the mission of propagating the Malaysian Halal Standard to the global Halal manufacturers and traders.
The proliferation of Halal in Malaysia cannot be divorced from the developments in the country over the past three decades, including its steady economic growth, the emergence of large groups of Malay Muslim middleclass consumers, and centralized state incentives that attempt to strengthen Halal production, trade, and consumption.
Scholars say that the concerns given to the Halal products by the western communities related to the creation of “Muslim space” in the western countries. For instance, the display and transmission of Halal and its involvement in the production, recognition, and contestation in London did create awareness and acceptance of Halal products. Meanwhile, Turkish migrants in Germany take great care to prevent the moral contamination from Haram (unlawful or forbidden) meat that can seem threatening to them in Germany.
Similarly, in the contemporary London, Halal is no longer an expression of esoteric forms of production, trade and consumption, but a part of a huge and expanding globalization market. In the modern food industry, a number of Muslim requirements have taken effect, for example an injunction to avoid any substances that might be contaminated with porcine residues or alcohol, such as gelatin, glycerin, emulsifiers, enzymes, flavors, and flavorings. This outcome may reflect the health and hygiene issues awakened by the Halal concept in the contemporary urban living lifestyle.
1.2 Definition of E-marketplace
E-marketplace is an electronic exchange marketplace where firms register as sellers or buyers to communicate and conduct business over the Internet. The E-marketplace has become an important electronic shopping environment that may evolve into a dominant force in Internet marketing. Most of the E-marketplaces with online stores are offering competing products. Featuring is associated with a price premium and it serves as a mechanism to mitigate competition among online stores. In essence, featuring facilitates a convenience-price trade-off. Those consumers who find that the cost of searching outweighs the benefit of a lower expected price shop at the featured store where the price is higher on average.
1.3 The Emerging of Halal E-marketplace
With Muslim population at a staggering figure of 1.8 billion and amounting to a USD2.1 trillion in 2008, the economists said that the growth of Global halal market is definitely depending on the participation of E-commerce and Halal E-marketplace. Currently, the major marketing channel for the Halal commodity suppliers and retailers is the commodity wholesale market. Contradicted to the conventional E-marketplace, one of the unique features of Halal E-Marketplace is that it requires all the Halal businesses and services to be provided and transacted online according to the Halal principles and Muslim values. This is to ensure the benefits of the Halal consumers from around the world.
The unique features of the Halal E-Marketplace include:
• Only the Halal certified products and services can be exhibited and traded online
• Operated according to the Halal principles and Muslim values
• Cultivate the Islamic values of Hygiene, Sincerity, Fairness and Trustworthiness
• Promotes the right way of doing trading activities
1.4 Economic Beneficial of the Halal E-marketplace
Halal industry businesses and services providers can be benefit from the Halal E-Marketplace. They may operate on a cost-recovery basis by an independent third party (such as an industry association) or be set up as a business offering, with a middle-person providing a value-added function such as transaction services. Services offered by Halal E-marketplaces include the business directory listings, electronic catalogues for online purchasing of goods and services and trading or transaction services.
The economic beneficial of the Halal E-marketplace may include:
• Greater opportunities for the Halal suppliers and buyers to make new trading partnerships, either within their supply-chain or across supply-chains
• The potential to lower the costs of negotiating and making transactions with automation of standard business procedures
• The potential for more transparent pricing as Halal buyers and sellers take the opportunity to trade in a more open environment
• The opportunity to access value-added services such as inventory control and management of dispatch and distribution processes using electronic systems
• The potential to access Global Halal Market
1.5 The Popularity of Halal E-marketplace
The Halal E-marketplace can be categorized as the directory and business portal. Some of the Malaysian Halal E-marketplace includes the DagangHalal.com, worldhalal.com and the Comprehensive Halal Directory: Link developed by the Malaysia Halal Development Cooperation. Based on the statistics by Google Analytics, DagangHalal.com is currently the No.1 ranking Halal business portal which originated from Malaysia, followed by the HalalBusinessDirectory.com which is a Halal business yellow pages in UK.
Besides, some of the governmental Halal E-marketplace include the Australian Halal Food Directory and Singapore Halal Directory. In fact, Muslim countries like Malaysia, Brunei Darussalam, Pakistan and Singapore are currently speeding the promotion of Halal concept, which aims to integrate the Halal producers and marketers. Thus, the development of Halal E-marketplace is facing huge challenge, in the perspective of having qualified Halal certified food producers to join in the Halal E-marketplace as to ensure the safety, hygiene and fairness of the commodity trading.
Encik Khairil Ismahafiz bin Muhadzir
Chief Marketing Officer, DagangHalal.com