The Halal market boom

The global Halal economy is projected to grow to approximately $10 trillion by 2028. Spending on and use of Halal products is trending upwards, expanding to include non-Muslims.

The Halal market encompasses a wide range of products, from food and beverages to cosmetics, pharmaceuticals, and finance... (Source: Getty)

In recent years, the global Halal market has been experiencing remarkable growth. This is driven by increasing demand from Muslim consumers coupled with growing recognition of Halal products among non-Muslims. The booming Halal consumer market presents numerous opportunities and challenges for businesses seeking to tap into this vast and promising market.

Halal, in Arabic, means "permitted" or "lawful." The Halal market encompasses a wide range of products, from food and beverages to cosmetics, pharmaceuticals, and finance. The Halal industry spans many different sectors and is estimated to be worth trillions of dollars globally. The exponential growth of the Muslim population, coupled with increased awareness and adherence to Halal practices, has fueled the expansion of this market.

In an article published in 2021, aa.com.tr cited information from the World Halal Union stating that international organizations estimate the size of the global Halal economy to reach over $7 trillion in 2022 and is expected to increase to approximately $10 trillion by 2028. Spending on and use of Halal products is trending upwards, expanding to include non-Muslims.

Take advantage of the opportunity.

Diverse Consumer Base : One of the most significant opportunities offered by the Halal market is access to a diverse and rapidly growing consumer base. According to the Global Islamic Economic Index (GIE), the Muslim population is projected to grow from 1.8 billion in 2017 to 3 billion in 2060. This vast market has a substantial demand for Halal-certified products across various regions and demographics.

Market Segmentation: Businesses can capitalize on the Halal market by serving appropriate segments within the Muslim community. This could involve offering specialized Halal products, such as organic Halal food, eco-friendly cosmetics, or Sharia-compliant financial services, to meet specific consumer needs and preferences.

Global scale: The Halal market is not limited to countries with a majority Muslim population; it extends to countries with minority Muslim populations and non-Muslim consumers who seek Halal-certified products for ethical, health, or quality reasons. Therefore, businesses have the opportunity to expand globally by tapping into these diverse markets.

Innovation and Creativity: As the Halal market continues to grow, there remains room for innovation and creativity in marketing and product development strategies. Businesses can differentiate their brands by offering unique and innovative Halal products that cater to emerging trends and consumer preferences.

The increasing popularity of the Halal market has led to increased competition among businesses. (Source: Halal Food Council USA)

Challenge List

Certification and Compliance: Achieving Halal certification can be a complex and costly process, involving stringent standards and regulations set by certification bodies. Businesses may face challenges in ensuring their products comply with Halal requirements, especially if they operate in multiple markets with varying certification standards.

Supply chain management : Maintaining a Halal supply chain from raw material sourcing to production and distribution can present logistical challenges for businesses. Ensuring the integrity of ingredients and production processes requires meticulous attention to detail and robust quality control measures.

Market Competition : The increasing popularity of the Halal market has led to growing competition among businesses for consumer attention. Businesses must differentiate their brands and products and effectively capture market share to stand out in a crowded market.

Cultural and local sensitivity : Understanding the cultural nuances and preferences of diverse Muslim communities is essential for successful market entry. Businesses need to adapt their products, marketing messages, and branding strategies to suit local customs and values, especially in international markets.

The booming Halal market presents lucrative opportunities for businesses willing to navigate the complexities and challenges of this rapidly developing industry. By capitalizing on the growing demand for Halal products and services, businesses can successfully cater to the needs and preferences of Muslim consumers worldwide. However, this requires careful planning, innovation, and a deep understanding of cultural and regulatory factors. With the right approach and a commitment to quality and compliance, businesses can capitalize on the Halal market boom and thrive.

The development of Vietnam's Halal industry in recent years has seen relatively positive changes; however, fundamentally, Vietnam's participation in the Halal market is still in its early stages; the concept and market of Halal are still quite new in our country.

As of September 2023, more than 1,000 small and medium-sized enterprises (SMEs) in Vietnam, in addition to a few large corporations ( Vinamilk , Nestle Vietnam, Hapro, Trung Nguyen, etc.), exported Halal-certified products. Vietnamese Halal products account for a small proportion of the overall export structure to Muslim/Muslim-majority markets and are mainly in raw or semi-processed form, lacking significant added value.

On February 14, 2023, the Prime Minister issued a Decision approving the Project "Strengthening International Cooperation to Build and Develop the Halal Industry in Vietnam by 2030". This is a significant achievement after two years of effort and close coordination between the Ministry of Foreign Affairs and other ministries, sectors, localities, associations, and businesses in developing the Project (including three rounds of consultations and numerous conferences and seminars). This can also be considered a very important turning point in the development of the Halal industry in Vietnam, for the first time providing comprehensive national-level orientations for mobilizing international resources to develop the Halal industry in Vietnam in a comprehensive, systematic, and professional manner.

Source: https://baoquocte.vn/su-bung-no-cua-thi-truong-halal-co-hoi-va-thach-thuc-cho-doanh-nghiep-276578.html