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CHAPTER ONE

INTRODUCTION

1.0 INTRODUCTION

Halal food industry in Malaysia is booming in recent years. Consumer demand on food has

also changed considerably. Alongside with the national aim to make Malaysia as the world

halal hub (Habibah, 2011), the industry is gaining its popularity day by day and opens up

opportunities to halal food producers to expand their target market domestically and internationally.

Though halal concept relates the Muslim society in specific (Alam and Nazura, 2011), there is a

huge potential to tap the non-Muslim community interests when it comes to food. Food in general is

defined as anything eaten or taken orally to the body as a source of energy.

Furthermore, the fact that food is a common need among people, the market potential is even

more promising though people from different cultural backgrounds and religion have different

perceptions and experiences to food. In today’s society, the increasing concern over health promotes

the acceptance on halal food as it covers the whole understanding of consuming clean and hygienic

food to promote better health. Consumers today are more aware of the importance of health thus

influence their behavior on food consumption. They search for food that can keep them healthy and

improve their mental state as well as their quality of life. In Islam, consuming halal food constitutes

an important aspect of the religion. The role of food in cultural practices and religious beliefs is

complex but has a unified understanding among Muslim followers. For instance, the halal logo or

label communicates and convinces Muslim consumers that the food product is produced and prepared

according to the Islamic requirement. On the other hand, the non-Muslim consumers understand that

food items carrying the logo are prepared in the most hygienic way and clean to be consumed.

Furthermore, it has also been proven that non-Muslim consumers do respond positively to

halal food certification (Siti Hasnah, Dann, Annuar and De Run, 2009). In Malaysia, the non-Muslims

constitute 38.7 percent of the population. This relatively high percentage of the non-Muslim

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consumers could indicate the opportunity for this market to be tapped as the niche halal market which

could then contribute more to the growth of halal food industry. (Muhammad, Norhaziah, Nuradli and

Hartini 2007) highlighted that halal food benefits not only the Muslims but everyone in general.

Therefore, this study aimed to determine the market acceptance level among the non-Muslim

consumers. Particularly, the research aimed to look into the acceptance level and the factors that

influence the acceptance.

1.1 PROBLEM STATEMENT

According to the study that researchers do about the non-Muslim perception towards Halal

food industry in Malaysia, the researchers have found several problem that might be occur that

probably effect the customer satisfaction in the states that has been chosen. The problem which

researcher can identify in this studies are about strengths, weaknesses, opportunities and threats. This

study is important for knowing the problem and find solution to the problem.

Firstly is Malaysian Halal certification is perceived as more valid compared to non-Muslim

country. In case, not only the Malaysia have a valid Halal certification but also there have certain

countries have their own valid Halal certification. Furthermore, this issues make the Malaysian afraid

to have Halal certification from other countries because they think it not valid in the country. Besides

that, some people make an expectation that money can buy Halal certificate and simply use it in their

businesses.

Secondly is some of the Halal logo is fake. In case, some group of people put fake Halal logo

on the inside and outside their premises. The owner use this Halal logo without permission or without

qualification from the JAKIM. In addition, they also convince customers that the restaurant is

registered under JAKIM. In the Sinar Harian newspaper dated 29 Oktober 2013 titled “Traders use

fake halal logo”, this case happened inBENTONG which an use unrecognized halal logo by JAKIM

to obscure the user's eyes become one of the tactics the trader to popularize their business primarily

involves the sale of food. Chairman of the Board Consumer Malaysia (MASB), Abdul Aziz Ismail

said monitoring carried out by the company, there are several business premises selling food in Rest

Genting Centre using that tactic. Besides that, he said traders halal logo patch in front of their

premises to attract customers especially Muslims. In this matter, the business to be more responsible

for their actions put fake halal logo on the front of the premises as 'cheating' customers. He added,

Muslim tradersneeds to put a valid halal logo to ensure the purity and cleanliness of the food is sold.

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Thirdly is Strong government support for Halal development. In case, lack support from them

will suffered the manufacturer or group of individuals who involved Halal Food industry.

Additionally, it will also make certain company in field run riot. However, there are also some

companies took the opportunity to forge close ties with the people in the government to make the

business run smoothly. Consequently, other companies will feel oppressed and unhappy.

Lastly is the existence and emergence of haram and doubtful substance. In case, in this case,

the user feels that the products made by certain companies, particularly in the food industry have

suspicious materials such as a mixture with other substances added to foods have long to make the

food more fresh despite the fact that he has already bred worms and stank. Additionally, there are also

companies that mix the beef with pork in the same process to save cost. For instance, according to

Star Online in KL dated June 11, 2010 which Most of the employees wore labelled halal logo, but it

was a surprise when a food producing company detected also sells pork-based products. More

disgusting, pig meat-based food that is put pork meatballs mixed with halal food such as noodles, fish

balls and fish cakes in the same refrigerator. However, the factory is located in Garden Silk, Sungai

Petani, Kedah was invaded by the enforcement Monitoring and Enforcement Branch Halal Hub

Division, Department of Islamic Development Malaysia (JAKIM) Putrajaya.

1.2 RESEARCH OBJECTIVES

The objective of this study is:

1.2.1 To identify the strengths factor that influences the customer perception towards Halal

food industry in Malaysia.

1.2.2 To identify the weaknesses factor that influences the customer perception towards

Halal food industry in Malaysia.

1.2.3 To identify the opportunities factor that influences the customer perception towards

Halal food industry in Malaysia.

1.2.4 To identify the threats factor that influences the customer perception towards Halal

food industry in Malaysia.

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1.3 RESEARCH QUESTIONS

1.3.1 Does the strengths factor that influences the customer perception towards Halal food

industry in Malaysia?

1.3.2 Does the weaknesses factor influence the customer perception towards Halal food

industry in Malaysia?

1.3.3 Does the opportunities factor influence the customer perception towards Halal food

industry in Malaysia?

1.3.4 Does the threats factor influence the customer perception towards Halal food industry

in Malaysia?

1.4 RESEARCH SIGNIFICANT

1.4.1 To The Researcher

We can identify each problem has arisen in the Halal Food and find a solution to the problem.

This study can be a source of important information to future researchers who wish to do research on

similar topic. Future researchers may use this research as a guide as references for extending this

research by using variable and different places.

1.4.2 To The Customer

From the result of this researcher the public can find out what are strength, weakness,

opportunity and threat (SWOT) of Halal Food in Malaysia.

1.5 RESEARCH SCOPE

1.5.1 Subject

The study was made to identify who consume the Halal food in four countries including

Kuala Lumpur, Negeri Sembilan, Melaka and Johor (100 respondents).

1.5.2 Respondent

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As the respondents who consume the Halal food in four countries including Kuala Lumpur, Negeri

Sembilan, Melaka and Johor (100 respondent).

1.5.3 Location

The research is conducting in four countries including Kuala Lumpur, Negeri Sembilan, Melaka and

Johor (100 respondents).

1.6 RESEARCH CONTRIBUTION

1.6.1 To The Customer

The result from this analysis exposed informationand awareness towards non-Muslim

consumer about the strengths that a company have in food industry which make them more

compete besides have produces product according to the Halal standards that has been strict.

Besides that, they also know the weaknesses that the producer have in a certain company

especially in food industry. Furthermore, consumer also can see the opportunities that the

company has in term of providing a product that has more quality but still involve in Halal

perspective and know about the way of a company overcome the threats that have been faces

by the company itself.

1.6.2 To The Company

This SWOT analysis give enough information to the company on how their

businesses especially in food industry perform in the market. Besides that, they also can

reduce or avoid the weaknesses with make an improvement in providing the product but still

in Halal Standards guidelines. Moreover, they also can see the opportunities and have a

method to get over the threats in achieving their goals follows the Syara’ perspective.

1.6.3 Location

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Theresult from this analysis is to provide information to residents of the states that

researchers have been select about the importance of the halal food industry in their daily

lives. It is to discouraging them from making a wise choice in buying food products for their

healthy.

1.7 CONCLUSION

Today consumers want more products, with better quality, variety and convenience, whereas

producers want more access, sales increase and new lines, and retailers need a new niche market. It

has been assumed that the trouble soon to be faced by the halal market is shortages in demand. The

halal market is growing rapidly and is fast becoming a recognizable market force. It is a highly

lucrative market that has been underserved. The success of the halal food industry, in both domestic

and export markets, depends on a broad range of policy developments including those related to the

law and regulations, support services and infrastructure, such as human resource development, finance

and R&D, as well as marketing and promotional efforts. Malaysia’s role is not only to ensure that the

food is completely halal, but also to add value through providing services such as halal management,

logistics and finance. In other words, the country must also provide the system that would be able to

ensure its international credibility.

CHAPTER TWO

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LITERATURE REVIEW

2.0 INTRODUCTION

All Muslims must observe their respective Islamic teaching and principles or better known as

Islamic Law (Shariah) in every part of their lives, most importantly, food consumption. The Shariah

demonstrates that it is crucial for Muslims to consume only Halal (permitted) food and avoid any

activities that are or will lead to Haram (prohibited) as it is extensively mentioned in the Quran:

“Forbidden to you is that which dies of itself, and blood, and the flesh of swine, and that on

which any other name than that of Allah has been invoked, and the strangled (animal) and that

beaten to death, and that killed by a fall and that killed by being smitten with the horn, and that

which wild beasts have eaten, except what you slaughter, and what is sacrificed on stones set

up (for idols) and that you divide by the arrows; that is a transgression”. Al-Ma’idah 5:3

The Malaysian Government under the Trade Description Order (The Usage Halal) 1975 define

Halal as the term used in relation to food in any form whatsoever, in the process of trade or commerce

as an aspect of trading or part of an aspect of trading for the referred to food, the term Halal,

Guaranteed Halal or Muslim Food or any other terms that may be used to indicate or may be

understood as meaning to indicate as permissible to be consumed by Muslims and allowed in their

religion for the referred to food to be consumed. Furthermore, Halal does not only concern about food

alone. In order for products or services to be deemed Halal, it must follow the Shariah principles that

states:

Does not contain any non-Halal parts or products of Haram animals or products or animals

that is not slaughtered in the name of Allah and Shariah methods

Does not contain any ingredients that are considered “najis” (unclean)

Safe and not harmful

Not prepared, processed or manufactured using tools or equipment that are contaminated or

used together with non-Halal or “najis”

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Ingredients or by-products does not contain any human part

During the process of manufacturing, preparation, packaging, storage or distribution, product

must be physically separated between Halal and Haram products.

There is a wide range of products and activities that fall under Halal rule such as storage and

distribution, pharmaceutical, cosmetics, finance and tourism (Hashim et al., 2009; Wan Hassan and

Awang, 2009; Haq and Wong, 2010; Tieman, 2011; Tieman et al., 2012; Mursyidi, 2013).

2.1 CUSTOMER

A customer can be a person or business entity who receives well and services from a vendor

in exchange of payment. According to Kendaal (2006) the customer and vendor are likewise known

as client, buyer, or purchaser and seller, or supplier respectively. Business Dictionary (2010) defined

customer as a recipient of goods and services, who is at liberty from one vendor or product to another.

2.2 PERCEPTION

Perception can be defined as the process in which a person selects, arranges and interprets

stimuli. These stimuli are filtered and adjusted to become one’s own world. Even though when two

persons are exposed to the same thing in the same environment, their experience may be not the same

(Schiffman and Kanuk 2010).

Perception is the process by which an individual selects, organizes and interprets information

inputs to create a meaningful picture of the world (George 2004). Perception of a service is a complex

series of judgment formed during or at the end of the experience (William and Buswell, 3003). The

perception as the perceived quality of services is the result of an evaluation process in which

customers compare their perceptions of service delivery with the expected outcome (Lovelock, 2001).

In term of social psychology, the word of perception refers to the different mental processes

that we use to form impressions of other people. This includes not just how we form these

impressions, but the different conclusions we make about other people based upon our impression

(Cherry, 2015).

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Our perception of others is biased by the primacy effect, negatively bias, attribution error, and

stereotyping. Our perception of self and others is a fundamental starting point of human

communication. We reveal who we are to others by self-disclosing. To be a competent communicator,

monitor your perceptual biases, avoid snap judgments, recognize cultural differences, manage the

impressions you make with others, practice empathy, and check your perceptions of others with them

(Rothwell, 2004).

2.3 CUSTOMER PERCEPTION

Customer perception applies the concept of sensory perception to marketing and advertising.

Just as sensory perception relates to how humans perceive and process sensory stimuli through their

five senses, customer perceptions pertains to how individuals form opinions about companies and the

merchandise they offer through the purchases they make. Merchants apply customer perception theory

to determine how their customers perceive them. They also use consumer perception theory to

develop marketing and advertising strategies intended to retain current customers (Blank, 2014).

Customer service and customer perceptions are always important but mainly for small businesses. By

knowing the customers’ perception, how they perceive service, selection or products, prices, location

and cleanliness, customers’ satisfaction and ultimately the success of the business can be affected

(Solvang, 2007).Perception is one biggest hurdle when dealing with customers. The customers see

things differently based on their view point or experiences, and their perceptions become had to

change. The customers’ perception also dictated whether they think they are getting good customer

service (Michel, 2006).

2.4 HALAL

When the term Halal is used in relation to food in any form whatsoever, in the process of

trade or commerce as an aspect of trading for the referred to food, the term ‘Halal’, ‘Guaranteed

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Halal’ or ‘Muslim Food’ or any other terms that may be used to indicate or may be understood as

meaning to indicate as permissible to be consumed by Muslims and allowed in their religion for the

referred to food to be consumed, must therefore mean as the following; does not stem from or consists

of any part of or item from animals that are forbidden to Muslims by Islamic Law, or animals that

have not been slaughtered according to Islamic Law; does not contain any substances that is

considered impure in Islamic Law; is not prepared, processed or manufactured using equipment or

utensils that are not free from impurities as defined by Islamic Law (Trade Description Order,

1975). According to Regenstein et al. (2003), most food producer point of view, Halal food is a pork

free, birds of prey, and alcoholic free food for the Muslims that when labelled/presented as such to the

market, shall provide enormous economic gain.

2.5 FOOD

Edible or portable substances (usually of animal or plant origin), consisting of nourishing and

nutritive components such as carbohydrates, fats, proteins, essential mineral and vitamins, which

(when ingested and assimilated through digestion) sustains life, generates energy and provide growth,

maintenance and health of body (Business Dictionary, 2010). Food is the substances that functional

as energy, supports the body growth, conduct the metabolism and act in mechanism body protection

(Sediaoetama, 1996).

2.6 INDUSTRY

Industry can be defined as all the occupation that produces money (Tim Grasindo, 2005).

The manufacturing or technically productive enterprises in a particular field, country, region, or

economy viewed collectively, or one of these individually. A single industry is often named after its

principal product; for example, the auto industry. For statistical purposes, industries are categorized

generally according a uniform classification code such as Standard Industrial Classification (SIC)

(Business Dictionary, 2010).

2.7 STRENGTHS

Dr. Johannes Von Franz & Dr. Nikolaus Schall (2000), stated that strength is questions

about what is that your business / organization does well? Why do your customers buy from you?

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What differentiates your business / organization in the market? What are the things that are going well

for you? ‘Strength’ is something that has a positive implication. It adds value, or offers your

organization a competitive advantage. Strengths include tangible assets such as available capital,

equipment, credit, established and loyal customers, existing channels of distribution, copyrighted

material, patents, information and processing systems, and other valuable resources. Besides that,

according to Standard & Quality news (Aug 2004), Malaysia has a strong reputation as an exporter

of Halal products, and this sector is expanding rapidly. By doing so it is bringing in foreign

investment, setting up Halal industrial parks and promoting links with foreign ports. Malaysia's

strength as a Halal food-producing centre is large domestic and regional Halal market

Firstly is Malaysian Halal Certification is perceived as more valid compared to non-Muslim

countries.The Malaysian government has actively provides incentives or grants scheme and other

facilities with the aimed to develop its halal industries (Bidin, 2009). In the ASEAN region, Malaysia

had been the most intensively positioning themselves to be a hub for halal food in Asia and become

the pioneer of halal certification standard globally. Malaysia became the first country to have a

governing body in halal industry and its halal business blueprints provides clear goals and guidelines

for the halal industry development. Currently, Malaysia's strength position lies in its halal certification

standard that has been recognized internationally and well planned halal industrial stages.

Secondly is Reputable Halal Food Service Providers. According to Frost & Sullivan (2013)

have forecasted that Malaysia’s food industry will enjoy 9.5 percent growth that is valued at US$45.1

billion. The promising food industry in Malaysia will directly benefit the Halal food industry. The

Halal food potential in Malaysia is due to many reputable Halal food service providers. Several

aspects in Halal food activities, for example transportation, warehouse and storage, have JAKIM and

Standards and Industrial Research Institute of Malaysia (SIRIM) MS1900:2005 certified service

providers.

Thirdly Recognized as Model for Muslim Country. In the year 2010, total Muslim population

in Malaysia was 17.1 million, 61.4 percent from the total population. The majority of Muslim

population puts Halal food products in good stead towards becoming a Halal hub. In addition,

Malaysia is recognized by the United Nation (UN) as the best country in producing Halal products

and holds reputable image among other Muslim countries (Bohari et al., 2013). Furthermore,

Malaysia is recognized as a Muslim country and is exemplary to other Muslims countries (Rabasa,

2003). Another justification why Malaysia is a recognized Muslim country is because of the JAKIM

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Halal certification, the Halal logo. Nik Muhammad et al. (2009) stated that Malaysia’s strength lies

in its certification.

Lastly is Safety and quality. A study done by Jaafar et al. (2011) concluded that for Halal

food industries service provider to fulfil the growing demand, they have to be innovative in initiating

more Halal foods services such as dedicated assets, comprehensive hygienic practices, and

maintaining a high level of safety and quality. Therefore, these Halal food service providers are

exemplary to indicate that safety and quality of food service providers are also venturing into Halal

food industries.

2.8 WEAKNESSES

According to Cesarettin, TÜBİTAK Marmara Research Centre Food Institute (2003)lack

of strong farmers‟ organizations. Insufficient integration and cooperation between agriculture and

agro-industry, some quality and safety problems in agriculture, and need to improve the official food

control system in line with the EU legislation, rather low investments in research and development,

some technology and capacity utilization problemsof food producing SMEs.

Weakness in Halal food industry in Malaysia is very obvious. According, Shafie and

Othman (2006) indicated that there are many issues and challenges on the Halal matter. Among the

issues mentioned are the lack of consistency in the definition of Halal on the aspect of animal

slaughtering, the release of Halal logo by individual firms, use of Arabic-sounded or Islamic-signalled

brand names, the rampant use of Quran verses or Arabic characters and lack of authority enforcement

in resolving abused Halal logos. In relation to the widespread of fake or outdated Halal logo, several

cases involving misused Halal certification have been reported in the news.

A famous local bread manufacturer claimed that their products were manufactured using 100

per cent Halal oil, but after further inspections, the oil was in doubt as it was imported from Israel and

Germany (Malay Mail, 2006). In addition, the New Straits Times (2006) reported a popular local

chicken meat producer was fined RM100 million for not ensuring their products were Halal.

Moreover, there are other irresponsible parties that put up fake Halal logo and certification at their

premises even though the items sold are not Halal. These parties that exploit the Halal certification

offers food products to consumers that may contain non-Halal substances from foreign countries as

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the product importers may not practice or understand the concept of Halal practiced in Malaysia. The

reason for the use of fake Halal certification may be the result from slow and inefficient process of

Halal certification. JAKIM’s failure in providing a fast and prompt Halal certification application

process is because of the lack of full-fledged research and development unit as well as no support

from third-party experts from local universities in commissioning lab testing, analysis and on-site

inspection (Shafie and Othman, 2006).

In addition, Farouk (2006) claimed that products with Halal logo on the packaging have been

found to have pork ingredients in certain food products. The reliability and authenticity of the Halal

logo for certain products or certification bodies are found to be unreliable and spark controversies in

Halal industry. This can be supported by Rezai (2012) that consumers react positively to food

products with the JAKIM Halal logo but are less confident with other Halal logo. Besides, according

the Pluralism Project Harvard University (2003), food items considered haram include pork and

beasts of prey; further, the consumption of intoxicants such as alcohol is also haram. Islam prescribes

a method by which animals may be slaughtered with minimal suffering. At the time of slaughter, the

name of God is pronounced, symbolizing God’s role as creator and provider: such meat is considered

halal.

Other than that, the weakness of the Malaysian halal food industry has a lot to do with the

halal food producers and suppliers which a conspicuous lack of professionalism. According to Abdul

Manaf Bohari, Cheng Wei Hin, and Nurwahida Fuad in their research (2013), the halal food

producers are noted for their slow follow-up responses depicting lack of seriousness in their attitude

and a short-term business perspective. Each firm has its own brand instead of operating under a

unified Malaysian halal brand identity. The product lacks attractiveness reflecting lack of professional

knowledge and training in product development. Almost all the local halal food firms do not follow

market labelling requirements especially regarding the products’ shelf life. And the last one is some

halal food firms lack knowledge in the legal, social, and cultural environment of the importing

countries. They are not able to identify consumer needs accurately in terms of taste and preferences.

They enjoy little strategic and long term alliances with importers or distributors or private market

agents to promote their products. They also lack the Islamic mind set and entrepreneurial skills

(Malaysia Journal of Society and Space, 2013).

2.9 OPPORTUNITIES

Based on the institute for higher education policy (1999) opportunity is essential to the task

of building consensus about how to operationalize and measure the goals of postsecondary

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educational opportunity. Ideally, opportunity would be defined according to each students own

interests and abilities. However, in terms of public policy (particular at the federal level), it is neither

practical nor possible to approach the issue from the individual perspective. A larger lens must be

applied to formulate policies and programs that address postsecondary participation more broadly.

Firstly is the strong government support. The Halal industry had long been recognized and

supported by the Malaysian government, and numerous efforts had been implemented. The support

has been widespread from the origins right until the final consumption. Efforts involving dedicated

Halal authority, Halal abattoirs, food premises, Islamic tourism, Halal pharmaceutical and healthcare

products, Shariah compliant logistics activities, Halal market conventions and conferences are some

of the many examples initiatives by the government. In the year 1982, the Malaysia government under

the Prime Minister’s Department established a ‘Committee on Evaluation of Foods, Drinks and Goods

Utilised by Muslims’ which is now known as Department of Islamic Development Malaysia

(JAKIM). Presently, the roles and responsibilities of JAKIM are more than just a Halal certification

authority. JAKIM’s role in the Halal industry involves educating the public and industry players by

producing the Manual Procedure of Halal Certification Malaysia as well as publishing the guidelines

for Appointment of Foreign Islamic Organization as Halal Certification Body for Products to be

exported into Malaysia. In addition, Bohari et al. (2013) indicated that Halal certification from

Malaysia is more valid compared to those from non-Muslim countries.

Secondly is increasing number of Muslim population. In case, Malaysia today is a

respectable Islamic country, progressive and highly regarded by other Islamic countries. The

development of Malaysian halal industry that successfully ventures in the international halal market,

especially in the food sector has raised the name of Malaysia. If carefully observed, the development

of halal industry in Malaysia shows a great potential in terms of increased profitability through

business opportunitiesthat can be explored in this market for halal products. Furthermore, the present

demand for halal market is expected to increase due to the increasing growth of population that

reaches two billion people with 57 countries in the world are Muslim majority. This is also based on

the increasing number of users and halal food products, which now totals four billion people (Utusan

Malaysia, 16 January 2009).Increasing demand for halal products is being seen in a number of

Muslim countries, with strong economic growth fuelling demand. Rising income levels in these key

markets have led to higher consumption rates and more opportunities for halal food producers.

Increasing number of Muslim population, the demand of food halal food product also increasing

(Ahmed,2008).

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Thirdly is Halal global trade potential. In case, the Malaysian government has identified the

food processing industry as a priority sector for industrial as well as export development. Recognizing

the potential of the halal food industry, the Malaysian Government aims to become the Global Halal

Hub by becoming a major producer of halal food and to be in the forefront of marketing, certification

and reference for halal food products. In the ASEAN region, Malaysia had been the most intensively

positioning themselves to be a hub for halal food in Asia and become the pioneer of halal certification

standard globally. Malaysia became the first country to have a governing body in halal industry and

its halal The Malaysian government has actively provides incentives or grants scheme and other

facilities with the aimed to develop its halal industries (Bidin, 2009). On the other hand, many

countries in Asia, Europe and also Australia and New Zealand had been aggressively obtained halal

market opportunities, including penetrating Indonesia as its main market. The global market for halal

products is estimated at US$580 billion a year. Global halal trade is approximately US$80 billion or

5% of total trade of agri-food products. In accordance with religious requirements, all Muslims must

eat, drink and take medicines that are halal, which is fuelling a large and growing demand for halal

products. Considering population growth rates and increasing incomes, it is estimated that in the

future, halal food may account for 20% of world trade in food products.

Lastly is demand and needs of halal food are growing up. Halal food demand has increased

tremendously in parallel with the expansion of 2.1 billion Muslim populations around the world.

According to Mariam (2010) size of halal market throughout the world is about USD 2.1 trillion and

in 2011 it is estimated that the size of halal food sector is USD 661 billion (World Halal Forum,

2011). Halal market is growing fast and has been increasing at an estimated 25% per year (Dewan

ekonomi, 2011). Halal food is becoming a lucrative business not only among Muslim but also non-

Muslim countries. Besides that, Malaysian government's mission to position Malaysia as the

International Halal Food Hub at the international level has put the country on a strategic path to

become the major halal food supplier base and the global halal certification centre. Malaysia has

developed special zones to encourage more foreign and local investments to go into business for

production and processing of food products. The success of the country in leading the development of

halal system in the food sector should be fully utilized by the business and production community in

particular the small entrepreneurs who are basically involved in industrial and food

business.Furthermore, according to Houssain, K. (2010), the global Halal food industry estimated to

be worth more than $650 billion in 2009 this is a major business and the opportunities are substantial.

2.10 THREATS

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The factors which need not necessarily be seen only from the negative side, it also can be a

challenge which may be posed by a favourable situation in the environment. According to Koschnik

(1992), a communication of a disagreeable alternative to an individual or group by one in authority or

who pretends to be. Besides that, a Soanes (2000) has stated three means of its intention to inflict

injury, damage, or other hostile action on someone, a person or thing likely to cause damage or danger

and the possibility of trouble or danger. Based on the Oxford (2002) an indication of the approach of

something unwelcome or undesirable.

Firstly is No Uniformity on Halal Standards. In case, during the World Halal Forum in

2006, the Chairman, Mr. Khairy Jamaluddin address the need for a unified Halal standards. In his

speech, he later stressed that the reason behind slow growth in the Halal industry in spite of the

demand worldwide is because that there is no uniformity on Halal standards. Besides that, according

to Halim and Salleh (2012) imply that the Halal standards and certification involves governments’

intervention and to have a standard Halal certification will mean surrendering their sovereign rights.

Moreover, Iberahim et al. (2012) has states which this clearly shows the lack of standardization in

Halal certification and causes issues and difficulties throughout the Halal supply chain and logistics

activities that comprise of producers, retailers, service providers and consumers. Furthermore, without

a standard worldwide Halal certification it will be difficult to maintain the Halal integrity because

certain Halal certifying authorities are not recognized in certain countries. Shafie and Othman,

(2006) has saying the halal certification is important because, among the Muslims, the Halal logo is

perceived to be more trustworthy and important compared to those that carry International Standard of

Organization (ISO) certification.

Other than that second threats is Existence and Emergence of Haram and Doubtful

Substance. In case, according to Nakyinsige et al. (2012) halal food products, such as Halal meat,

encompasses various elements, processes and procedures for instance meat origin and species,

production system, slaughter procedure and processing method are all invisible and cannot be

certified before purchasing or during consumption point. Besides that, Fadzlillah et al. (2011) has

stated a shocking discovery were found that lard (pig fat) is widely used for domestic consumption as

well as raw material in mass production in breads and cakes. He also added that there is an upward

trend in some countries to mix pork and lard in food production for the sake of profit maximization.

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Furthermore, a third threat is in term of product packaging which is there have no halallogo

on the packages. Moreover, Talib et al (2010), has views that plastics or microwaveable containers or

carton boxes are largely used for packing food products and are considered safe from any non-halal

substance but still the packaging materials and its origin raises doubt. Furthermore, the production of

plastic packaging uses animal-origin gelatines, and this voids the halal status as there are no scientific

ways to determine if the gelatines are from properly slaughtered animals or not. Another popular form

of packaging is the metal cans. The production of metal cans uses oil as lubricant to assists during the

production process, and the origin of the lubricant comes from animals which the Halal status could

be in doubt. According to Soong (2007), halal product packaging must consist of name or brand of the

product, minimum content in matric, name and address of manufacturer or distributor, list of

ingredients, code number representing production batch and manufactured and expiry date and Halal

logo from recognized certification agencies.

The last that can be a threat is a product labelling which that stick on the package forms as a

means for communication between manufacturer and consumer. The more information that can be

understood presented on the label, the better informed will be the consumer. According to

Underwood and Ozanne (1988) argued that the communication from manufacturer (package) to the

consumer was found to be typified by a lack of trust. They added that consumer often feel betrayed,

tricked or duped. Besides that, Davis and Wright (1992) noted that an analysis of consumer

purchasing behaviour suggests that many consumers do not appear to pay particular attention to

labelling information. They continue that the important contributor to this behaviour is due to lack of

knowledge about food additives and processing. The complexity, with which information is presented,

makes ingredients cues and other food claims difficult to be encoded in a meaningful way. White and

Parsons (2001) added, studies showed that warning labels that comes with difficult words were seen

as less safe by people regardless of their educational background. Hence the ultimate purpose of

warning that is to inform and protect consumers the possible danger of using a product, are often not

fulfilled.

2.11 TERMS OF THEORY

It is a belief about the relationship between each other some phenomenon and variable.

Theoretical frameworks provide a particular perspective, or lens, through which to examine a topic. It

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usually come from other disciplines such as economics, the social sciences, and anthropology and are

used by historians to bring new dimensions of their topic to light. There is no right or wrong

theoretical framework to use when examining your topic since every topic can be looked at from a

number of different perspectives.However, it also is even more specific than these broad subject

approaches. Theoretical frameworks are specific theories about aspects of human existence such as

the functioning of politics, the economy, and human relations. These theories can then be applied to

the study of actual events.

2.11.1 Independent Variables

Independent Variables is a matter or factor that will influence or affect other variables. In

addition, it is also the cause of the occurrence of something else. This type of variable is the way that

allows researchers to use them to analyse or as a way to solve a problem. Therefore, the factors

involved in this study are Strengths, Weaknesses, Opportunities and Threats.

2.11.2 Dependent Variable

While Dependent Variable is something to be influenced or affected by the independent

variable either by manipulation or studies and observations conducted by the researchers. In addition,

it is also known as Variable Result (Outcome Variable) or Variable Criteria. Therefore, the study of

which researcher do is through Customer Perception towards Halal Food Industry in Malaysia.

2.11.3 Theoretical Framework Figure

Strengths

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I.V D.V

Figure 2.10.3: Theoretical Framework

2.12 RESEARCH GAP

While the researchers conducted a study on consumer perception towards halal food industry

in Malaysia, researchers can identify some limitations when distributing questionnaires to the

Customer Perception towards Halal Food Industry

in Malaysia.

Weaknesses

Opportunities

Threats

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respondents in the states involved. Among them, the respondent did not cooperate when distributed

questionnaire because busy with other work. In addition, respondents were also not paying attention

and interest to the questions that were asked. Next, there are some respondents also consider research

as an insurance agent when distributed questionnaires. In addition, there are those who did not

understand the questions asked and cause them only a cursory read without reading them carefully.

2.13 CONCLUSION

In conclusion, the success of Halal food industries does not only lies on a single entity.

Support and collaboration between all parties which include Halal food service providers, Halal

authorities, governments or government agencies, Halal institutes and universities, product or service

manufacturers and consumers are all needed to have a wholesome and successful Halal food.

Therefore, it is hoped that this study will be a reference for all, current and future stakeholders in

Halal food industries. This study is the first of its kind since there have been no dedicated study on

Halal food SWOT Analysis.

CHAPTER 3

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RESEARCH METHODOLOGY

3.0 INTRODUCTION

This chapter describes the methodology used in this study. Aspects discussed in this chapter

were related to research design, sampling design, research instrument which is questionnaire, process

of data collection and data analysis. The gathering of primary data and the approach of the method

used in this research were also discussed.

3.1 RESEARCH DESIGN

Research design is the plan specifying the method and the procedures for collecting and

analyzing the needed information. This research attempt to identify the relationship between the

independent variables and dependent variable. This research is about consumer perception toward

halal food industry. Questioners were given to selected samples using convenience sampling method

to find out consumer perception toward halal food industry.

3.1.1 Descriptive Research

Descriptive research was undertaken to describe and measure the variables at a point in time

to answer the questions who, what, where, when, why, and how. The type of study for this research is

descriptive research. The researcher has already decide that variables that were used to investigate the

customer perception toward halal food.

3.2 SAMPLING DESIGN

In sampling design, it consist of population, sample size, sample selection, and explanation on

how the data of the study were obtained.

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3.2.1 Population

Population refers to the entire group of people, events, or things of interest that the researcher

wishes to investigate. (Sekaran, 2010). The target population at Melaka, Johor, Kuala Lumpur and

Negeri Sembilan.

3.2.2 Sample Size

In this study, the researcher distributed the questionnaire to the customers. For this research,

the sample size chosen was 100 respondent in that area chosen. All of the respondent were selected

from the population based on convenience sampling. The sample size consists of all type of customer

in terms of monthly income, age, and type of employment.

3.2.3 Sampling Method

There are two types of sampling methods which are probability and non-probability sampling.

Probability sampling is a sampling technique where in the samples are gathered in a process that gives

all the individuals in the population equal chances of being selected. In this sampling technique, the

researcher must guarantee that every individual has an equal opportunity for selection and this can be

achieved if the researcher utilizes randomization. Non-probability sampling is a sampling technique

where the sample is gathered in a process that does not given all the individuals in the population

equal chances of being selected. The sampling method for this research is non-probability sampling

using the convenience sampling technique. Researchers often believe that they can obtain a

representative sample by using a sound judgment, which will result in saving time and money”

(Black, 2010, p.225).

3.3 PROCESS OF DATA COLLECTION

Data collection is the process of preparing and collecting data in research project. The

purpose data collection is to obtain information, to keep and record, to make decision, and to share the

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information. This study used a questionnaire for data collection method to obtain more accurate and

complete information about customer perception toward halal food. The respondent of this research

consists of 100 people. All data were collected by using self-administrated questionnaire.

Respondents have spent less than 10 minute to complete questionnaire. 100 sets of questionnaire to

give a customer.

3.4 RESEARCH INSTRUMENT

The research instrument used this for study was questionnaire. The questionnaire in used in

this study is to find out customer perception toward halal food in Malaysia.

3.4.1 Primary Data

Primary source ware first-hand accounts of an event, a life or a moment in time. They were in

their original form (diaries, letters, etc) and ware usually without explanation or interpretation.

Historian Mary Lynn Rampolla defines primary source as “material produced by people or groups

directly involved in the even or topic under consideration”. Primary data is the data collected from

first-hand experienced. Primary data is collected by the investigator conducting the research. It is not

published yet and is more reliable, authentic, and objective. This primary data can never be neglected

by others.

3.4.2 Secondary Data

The secondary data for this research come from many sources such as the internet, articles,

journals, and other sources. It is easier and less expensive to collect secondary data. It can be used as a

reference or guideline to make sure all the research work is done in the right way.

A) Journal/Articles/Reports

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This research used and referred to journals, articles and reports to complete the literature

review in chapter two and also other information in chapter one and chapter three. The information

gathered has helped the researcher to find out the determinants that might contribute to this study and

helped to develop the blueprint of this as well as to complete this research.

B) Internet

The researcher also has surfed the internet and websites in order to find more information that

is related to the topic of research conducted. By using the internet, the researcher also could access the

journal online to find the information in order to complete research.

3.5 QUESTIONNAIRE DESIGN

The researcher also make a questionnaire. Questionnaire will be used as the research

instrument of this research. The purpose of using the questionnaire because it’s ensures

standardization and comparability of the data across interviews. To procedure for data collection was

through a self-administered question based on Likert Scale. The researcher should identify the right

sample and after that can contribute the data needed the questionnaire forwarded to respondent.

i) Checklist

The design was used in Section A, which is about personal data of the customer. The

respondents must choose only one answer from this question. Example:

Gender

Male ( ) Female ( )

ii) Close-ended question

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A close-ended question is a form of question which can normally be answered using

the “Likert” scale type. Close-ended question can be used for clarifying facts,

verifying information already given or controlling conversation among other things.

iii) Likert-scale question

This type of question was designed to identify how strong subjects or respondents

agree or disagree with the statement on five-point scale.

STRONGLY

DISAGREE

DISAGREE MEDIUM AGREE STRONGLY

AGREE

1 2 3 4 5

3.6 DATA ANALYSIS

The analysis and interpretation of data were done using descriptive and inferential statistics.

Descriptive statistics involve the description and summary of data, while inferential statistics involve

the inferences that are drawn from the results. Ultimately, the result of statistical investigation can be

represented graphically by means of bar chart or pie chart. In this instance, bar charts and pie charts

were used to compare value across categories.

Section Variable Number Of Question Types Of Analysis

A Demographic Profile 1-7 Frequency

B Strengths 1-5 Analysis of mean

B Weaknesses 1-5 Analysis of mean

B Opportunities 1-5 Analysis of mean

B Threats 1-5 Analysis of mean

3.7 VALIDITY TESTING

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3.7.1 Content Validity

Table 3.7.1: Reliability Statistics

Cronbach's Alpha N of Items

.917 20

Item-Total Statistics

Scale Mean if Item

Deleted

Scale Variance if Item

Deleted

Corrected Item-Total

Correlation

Cronbach's Alpha if

Item Deleted

B1 74.44 73.279 .119 .920

B2 73.85 67.927 .561 .913

B3 73.49 68.939 .430 .916

B4 73.86 66.808 .632 .911

CA1 74.23 69.694 .475 .915

CA2 74.21 68.915 .410 .916

CA3 74.08 68.377 .425 .916

CA4 73.84 65.732 .629 .911

CB1 73.85 65.462 .747 .908

CB2 73.72 65.557 .728 .909

CB3 73.62 66.016 .690 .910

CB4 73.71 65.198 .707 .909

CC1 73.55 67.159 .552 .913

CC2 73.48 67.000 .647 .911

CC3 73.49 66.939 .658 .911

CC4 73.46 66.958 .612 .912

CD1 73.76 66.164 .632 .911

CD2 73.93 67.379 .563 .913

CD3 74.04 68.241 .548 .913

CD4 73.69 67.691 .553 .913

Based on the Cronbach's Alpha for the whole reliability Test variables, found the Cronbach's

alpha was 0.917. It shows the overall Cronbach's Alpha value is excellence.However, the Cronbach's

alpha can be improved by referring to the "Cronbach's Alpha if item deleted", found that the value of

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CB1 shows a higher value than the actual value of Cronbach's Alpha, the item can be dropped. This

value is 0.920> 0.917 actual Cronbach's Alpha.

3.8 CONCLUSION

Chapter three discussed the primary data and secondary data which are used to prepare and

construct the questionnaire. The research instrument used is questionnaire. The questionnaire was

constructed based on research objectives which were addressed in literature review in chapter two. In

addition, the research instrument consists of close-ended questions. It comprises two section which

are sections A and section B. This chapter also deals with the research design used in this study

besides other aspects like sampling design, sampling methods, process of data collection, research

tools, and types of data analysis.

CHAPTER FOUR

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DATA ANALYSIS

4.0 INTRODUCTION

This chapter describes all the information that has been analysed data from a study

questionnaire which was circulated earlier to consumers in the states which have researchers chose

Kuala Lumpur, Negeri Sembilan, Malacca and Johor. This questionnaire seeks to obtain information

about consumer perception towards halal food industry in Malaysia.

In addition, there are three parts in the questionnaire form to be filled in by the respondents,

namely sections A, B, and C. This is where part A is relevant to the respondent demographic

information including gender, status, age, race, religion, occupation, income, While section B

describes the four independent variables (IV) which influence user perceptions of strengths,

weaknesses, opportunities and threats are also found in this study. Next, the C detailing each item is

independent variables.

In addition, after the study the researchers will complete the encoding (coding) into SPSS by

using the forms filled in by each respondent. Next, the researchers will provide the SPSS output,

including testing of the mean value for each IV which researchers have examined.

4.1 DEMOGRAPHICS PROFILES OF THE RESPONDENTS

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Demographic profile of the respondents consists of gender, age, race, marital status, religion,

occupation and income. These data were collected from the respondents who used to visit the states

that researchers choose. Each question from the questionnaire was analysed to find out whether the

research objectives are achieved. The researcher uses the tables and pie charts to show the

demographics profiles and preferences of 100 respondents who were selected for this research.

4.1.1 Gender

Table 4.1.1: Frequency of Distribution of Respondents by Gender

Frequency PercentMALE 47 47.0FEMALE 53 53.0Total 100 100.0

47%

53%

GENDERMALE FEMALE

Figure 4.1.1: Frequency of Distribution of Respondents by Gender

This study shows that 47 males and 53 females were chosen to answer the questionnaires.

Table 4.1.1 and Figure 4.1.1 below show the frequency of gender in this study where there were 53

females which comprise of 53% whereas the male were 47 people which comprise of 47%. Most of

the respondents are females because the respondents are randomly selected by the conductor without

concerning the difference of gender.

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4.1.2 Marital Status

Table 4.1.2: Frequency of Distribution of Respondents by Marital Status

Frequency PercentSINGLE 40 40.0MARRIED 52 52.0DIVORCED 8 8.0Total 100 100.0

40%

52%

8%

MARITAL STATUSSINGLE MARRIED DIVORCED

Figure 4.1.2: Frequency of Distribution of Respondents by Marital Status

Table 4.1.2 and Figure 4.1.2 show the respondent’s marital status that has beenanalysed from

the data obtained from the questionnaires. According to the survey that 40% 52% 8% Marital Status

Single, Married, Divorced are conducted, 40% or 40 respondents are singles, 52% or 52 respondents

are married whereas 8% or 8 respondents are in divorced group of marital status. This is because, they

are more concern about healthiness to their family.

4.1.3 Age

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Table 4.1.3: Frequency of Distribution of Respondents by Age

Frequency Percent21-30 YEARS 42 42.031-40 YEARS 34 34.041 YEARS AND ABOVE 24 24.0Total 100 100.0

42%

34%

24%

AGE

21-30 YEARS 31-40 YEARS 41 YEARS AND ABOVE

Figure 4.1.3: Frequency of Distribution of Respondents by Age

Table 4.1.3 and the Figure 4.1.3 shows the age distribution of the respondents.From the

results shown below, majority of the respondent was between 21 to 30 years old with the percentage

of 42%. This is followed by the second highest frequency which is 34% of respondents who are

between 31 to 40 years old. The lowest frequency was only 24% of respondents are 41 years and

above. The majority of respondent’s age was between 21 to 30 years old because at this age, they are

more searching of the Halal food.

4.1.4 Race

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Table 4.1.4: Frequency of Distribution of Respondents by Race

Frequency Percent

MALAY 32 32.0CHINESE 24 24.0INDIAN 25 25.0

OTHERS 19 19.0Total 100 100.0

32%

24%

25%

19%

RACE

MALAY CHINESE INDIAN OTHERS

Figure 4.1.4: Frequency of Distribution of Respondents by Race

The table 4.1.4 and Figure 4.1.4 show that majority of respondent are Malay which comprise

of 32% or 32 respondents. The second highest of respondent race was Indian which comprise of 25%

or 25respondents. Thirdly respondents that are Chinese which comprise of 24% or 24 respondents.

Lastly is the “Others” respondents which comprise 19% or 19 respondents. In case, the Malay

respondents is highest percentage because they have awareness about consume Halal food in daily

lives.

4.1.5 Religion

Table 4.1.5: Frequency of Distribution of Respondents by Religion

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Frequency PercentISLAM 32 58.0CHRISTIAN 19 12.0HINDU 25 16.0BUDDHIST 24 14.0Total 100 100.0

32%

19%25%

24%

RELIGION

ISLAM CHRISTIAN HINDU BUDDHIST

Figure 4.1.5: Frequency of Distribution of Respondents by Religion

The table 4.1.5 and Figure 4.1.5 shows that majority of respondent are Islam which comprise

of 32% or 32 respondents. The second highest of respondent race was Hindu which comprise of 25%

or 25respondents. Thirdly respondents that are Buddhist which comprise of 24% or 24 respondents.

Lastly is the Christian respondents which comprise 19% or 19 respondents. In case, the Islam

respondents is highest percentage because they know the Halal and Haram food.

4.1.6 Occupation

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Table 4.1.6: Frequency of Distribution of Respondents by Occupation

Frequency PercentGOVERNMENT SECTOR 34 34.0PRIVATE SECTOR 44 44.0OTHERS 22 22.0Total 100 100.0

34%

44%

22%

OCCUPATION

GOVERNMENT SECTOR PRIVATE SECTOR OTHERS

Figure 4.1.6: Frequency of Distribution of Respondents by Occupation

The table 4.1.6 and Figure 4.1.6 showsthat the highest occupation are Private Sector which

comprise of 44% or 44 respondents whereas the second occupation is Government Sector which 34%

or 34respondents. Lastly, there is 22% or 22 respondents are from “Others”.

4.1.7 Income

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Table 4.1.7: Frequency of Distribution of Respondents by Income

Frequency PercentRM1000-2000 42 42.0RM2001-3000 33 33.0RM 3001 AND ABOVE 25 25.0Total 100 100.0

42%

33%

25%

INCOME

RM1000-2000 RM2001-3000 RM 3001 AND ABOVE

Figure 4.1.7: Frequency of Distribution of Respondents by Income

The Table 4.1.7 and Figure 4.1.7 shows the highest distribution of monthly income was RM

1000 to RM 2000 which comprise of 42%. The second highest distribution of monthly income was

RM 2001 to RM 3000 where it comprises of 33% whereas the distribution of monthly income that

RM 3001 and above is 25%.

4.2 ANALYSIS MEAN

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In this section the researcher will show the data related to the factors affects the Customer

Perception towards Halal Food Industry in Malaysia. The factors include Strengths, Weaknesses,

Opportunities and Threats. The table of mean will show each factor in the questionnaire.

4.2.1 Dependent Variable: Customer Perception towards Halal Food Industry in Malaysia

NO. DESCRIPTION MEAN RANK

B1 The strengths can make Halal food industry more compete. 3.26 4

B2 Halal firms still have not used sophisticated technology. 3.85 2

B3 The ways to operationalize and measure the goals. 4.21 1

B4 Cause damage or danger and the possibility of trouble. 3.84 3

The table 4.2.1 above shows the average mean value for the dependent variable for the

Customer Perception towards Halal Food Industry in Malaysia is 3.79. Since the average mean for

the dependent variable is more than 3.50, so the average mean value for the Customer

Perception towards Halal Food Industry in Malaysia are accepted. The highest rank was show on

B3:“The ways to operationalize and measure the goals”with the mean value of 4.21 whereas

second rank was show on B2: “Halal firms still have not used sophisticated technology” with the

mean value of 3.85. The third rank was show on B4: “Cause damage or danger and the

possibility of trouble” with the mean value of 3.84 whereas the lowest rank was show on B1:

“The strengths can make Halal food industry more compete” with the mean value of 3.26.

4.2.2 Independent Variable

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4.2.2.1 Strengths

Table 4.2.2.1: Mean Value of Strengths Factor

NO. DESCRIPTION MEAN RANK

CA

1

Malaysian Halal Certification is perceived as more valid compared

to non-Muslim country.3.47 4

CA

2

High reputable Halal food service provides.3.49 3

CA

3

Recognised as model for Muslim country.3.62 2

CA

4

Maintaining high level of safety and quality.3.86 1

Overall Average Mean: 3.61

The Table 4.3.1 above show the average mean value ofstrengths factor is 3.61. Since the

mean average is more than 3.50, the average mean of strengths factor is accepted. From the Table

4.3.1, the highest rank was show on CA4: “Maintaining high level of safety and quality” with the

mean value of 3.86 whereas second rank was show on CA3: “Recognised as model for Muslim

country” with the mean value of 3.62. The third rank was show on CA2: “High reputable Halal food

service provides”with the mean value of 3.49 whereas the lowest rank was show on CA4: “Malaysian

Halal Certification is perceived as more valid compared to non-Muslim country” with the mean value

of 3.47.

4.2.2.2 Weaknesses

Table 4.2.2.2: Mean Value of Weaknesses Factor

NO. DESCRIPTION MEAN RANK

CB1 Some of the Halal logo is Fake. 3.85 4

CB2 Have non-Halal ingredient in certain Halal product. 3.98 3

CB3 Company have conspicuous lack of professionalism. 4.08 1

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CB4 Lack knowledge in the legal, social and cultural environment. 3.99 2

Overall Average Mean: 3.98

Table 4.3.3 above show average mean value of weaknesses factor is 3.98. As the average

mean of weaknesses was exceeds 3.50, this means that the average mean value is accepted. The

highest rank was show on CB3: “Company have conspicuous lack of professionalism” with mean

value of 4.08 whereas second rank was show on CB4: “Lack knowledge in the legal, social and

cultural environment”with the mean value of 3.99. The third rank was show on CB2: “Have non-Halal

ingredient in certain Halal product”with the mean value of 3.98 whereas the lowest rank was show on

CB1: “Some of the Halal logo is Fake”with the mean value of 3.85.

4.2.2.3 Opportunities

Table 4.2.2.3: Mean Value for Opportunities Factor

NO. DESCRIPTION MEAN RANK

CC1 Strong government support for Halal development. 4.15 4

CC2 Muslim population are growing in country. 4.22 2

CC3 Halal food has a global trade potential. 4.21 3

CC4 Demand and needs of Halal food are growing up. 4.24 1

Overall Average Mean: 4.21

Table 4.3.3 above show average mean value of opportunities factor are 4.21. As the average

mean of opportunities was exceeds 3.50, this means that the average mean value is accepted. The

highest rank was show on CC4: “Demand and needs of Halal food are growing up” with mean value

of 4.24 whereas second rank was show on CC2: “Muslim population are growing in country” with the

mean value of 4.22. The third rank was show on CC3: “Halal food has a global trade potential”with

the mean value of 4.21 whereas the lowest rank was show on CA1: “Strong government support for

Halal development”with the mean value of 4.15.

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4.2.2.4 Threats

Table 4.2.2.4: Mean Value for Threats Factor

NO. DESCRIPTION MEAN RANK

CD1 No uniformity on Halal standards. 3.94 2

CD2 Existence and emergence of Haram and doubtful substance. 3.77 3

CD3 Do not have Halal logo on the packages. 3.66 4

CD4 The product labelling is not stated more details. 4.01 1

Overall Average Mean: 3.85

Based on table above shows that the average means value for threats Factor is 3.85 where it

exceeds 3.50. As it is more than 3.50, the average mean value for threats Factor is accepted. The

highest rank was show on CD4: “The product labelling is not stated more details” with the mean value

of 4.01 whereas second rank was show on CD1: “No uniformity on Halal standards”with the mean

value of 3.94. The third rank was show on CD2: “Existence and emergence of Haram and doubtful

substance” with the mean value of 3.77 whereas the lowest rank was show on CD3: “Do not have

Halal logo on the packages”with the mean value of 3.66.

4.3 OVERALL AVERAGE MEAN VALUE

Table 4.3: Overall Average Mean Value

NO. DESCRIPTION MEAN RANK

1 Strengths 3.61 4

2 Weaknesses 3.98 2

3 Opportunities 4.21 1

4 Threats 3.85 3

Overall Average Mean: 3.91

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The table 4.4 shows overall average mean value on factors that affect the Customer

Perception towards Halal Food Industry in Malaysia. The highest average mean value from all factors

are opportunities factor with mean of 4.21, which shows that many respondents agreed that

opportunities play an important role in Customer Perception towards Halal food industry in Malaysia.

This is followed by average mean value of weaknesses factor with the value of 3.98, threats factor

with the value of 3.85 and lastly Strengths factor with average mean value of 3.61.

4.4 CONCLUSION

Based on the discussion above, it is obvious that the researchers made an attempt to ascertain

the extent to which a combination of the independent variables would be predict the consumer

perception. From the point of view of respondents, opportunities factor is the most influential factor

follow by weaknesses, threats and strengths. Besides, all factors are satisfied by the respondent where

they having a positive view or experience towards Halal Food Industry in Malaysia. Therefore, all the

objectives are estimated.

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CHAPTER 5

RESEARCH DISCUSSION AND CONTRIBUTIONS

5.0 INTRODUCTION

This chapter discusses the overall conclusion about research project. The researcher also

provides recommendations that are related to this research and for future researchers. The researcher

will discuss about the conclusion on factors that affect the customer perception towards Halal food

industry in Malaysia. The variables included in this research are strengths, weaknesses, opportunities

and threats. Based on the analysis done on the data gathered from the 100 respondents, the result

shows positive relationship because the entire factor average mean is more than 3.50. Based on Table

4.4, in terms of factors that affect the customer perception towards Halal food industry in Malaysia,

the first rank opportunities, followed by weaknesses, threats and strengths.

5.1 DISCUSSION

5.1.1 Opportunities

Overall average mean value for opportunities factor is 4.21 where it is more than 3.50 which

shows that respondents are agree to the factor. We can conclude that the opportunities factor in this

study is accepted as one of the factor which can influence the customer perception towards Halal food

industry in Malaysia.

According to analysis that made in chapter 4, it shows that respondent most agree to

“Demand and needs of Halal food are growing up” with the mean of 4.24 which can influence the

customer perception towards Halal food industry in Malaysia. According to Mariam (2010) size of

halal market throughout the world is about USD 2.1 trillion and in 2011 it is estimated that the size of

halal food sector is USD 661 billion (World Halal Forum, 2011). Halal market is growing fast and has

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been increasing at an estimated 25% per year (Dewan ekonomi, 2011). Halal food is becoming a

lucrative business not only among Muslim but also non-Muslim countries. Besides that, Malaysian

government's mission to position Malaysia as the International Halal Food Hub at the international

level has put the country on a strategic path to become the major halal food supplier base and the

global halal certification centre. Malaysia has developed special zones to encourage more foreign and

local investments to go into business for production and processing of food products. The success of

the country in leading the development of halal system in the food sector should be fully utilized by

the business and production community in particular the small entrepreneurs who are basically

involved in industrial and food business. Therefore, our objective for this study is achieved.

5.1.2 Weaknesses

Overall average mean value for weaknesses factor is 3.98 where it is more than 3.50 which

shows that respondents are agree to the factor. We can conclude that the weaknesses factor in this

study is accepted as one of the factor which can influence the customer perception towards Halal food

industry in Malaysia.

According to analysis that made in chapter 4, it shows that respondent most agree to

“Company have conspicuous lack of professionalism” with the mean of 4.08 which can influence the

customer perception towards Halal food industry in Malaysia. According, Abdul Manaf Bohari,

Cheng Wei Hin, and Nurwahida Fuad in their research (2013), the halal food producers are noted

for their slow follow-up responses depicting lack of seriousness in their attitude and a short-term

business perspective. Each firm has its own brand instead of operating under a unified Malaysian

halal brand identity. The products lacks attractiveness reflecting lack of professional knowledge and

training in product development. Almost all the local halal food firms do not follow market labelling

requirements especially regarding the products’ shelf life. And the last one is some halal food firms

lack knowledge in the legal, social, and cultural environment of the importing countries. They are not

able to identify consumer needs accurately in terms of taste and preferences. They enjoy little

strategic and long term alliances with importers or distributors or private market agents to promote

their products.

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5.1.3 Threats

Overall average mean value for threats factor is 3.85 where it is more than 3.50 which show

that respondent are agree with the factor. We can conclude that the threats factor in this study is

accepted as one of the factor which can influence the customer perception towards Halal food industry

in Malaysia.

According to analysis that made in chapter 4, the researchers have found more respondent are

agree to “the product labelling is not stated more details” with the mean of 4.01 which can influence

the customer perception towards Halal food industry in Malaysia. The result is supported by

Underwood and Ozanne (1988) argued that the communication from manufacturer (package) to the

consumer was found to be typified by a lack of trust. They added that consumer often feel betrayed,

tricked or duped. Besides that, Davis and Wright (1992) noted that an analysis of consumer

purchasing behaviour suggests that many consumers do not appear to pay particular attention to

labelling information. They continue that the important contributor to this behaviour is due to lack of

knowledge about food additives and processing. The complexity, with which information is presented,

makes ingredients cues and other food claims difficult to be encoded in a meaningful way. White and

Parsons (2001) added, studies showed that warning labels that comes with difficult words were seen

as less safe by people regardless of their educational background. Hence the ultimate purpose of

warning that is to inform and protect consumers the possible danger of using a product, are often not

fulfilled. Therefore, our objective for this study is achieved.

5.1.4 Strengths

Overall average mean value for strength factor is 3.61 where it is more than 3.50 which shows

that respondents are agree to the factor. We can conclude that the strength factor in this study is

accepted as one of the factor which can influence the customer perception towards Halal food industry

in Malaysia.

According to analysis that made in chapter 4, it shows that respondent most agree to

“Maintaining high level of safety and quality” with the mean of 3.86 which can influence the

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customer perception towards Halal food industry in Malaysia. According to Jaafar (2011), concluded

that for Halal food industries service provider to fulfil the growing demand, they have to be

innovative in initiating more Halal foods services such as dedicated assets, comprehensive hygienic

practices, and maintaining a high level of safety and quality. Therefore, these Halal food service

providers are exemplary to indicate that safety and quality of food service providers are also venturing

into Halal food industries. Therefore, our objective for this study is achieved.

5.2 SUGGESTION

According to the research that had made, there are four independent variables which are

opportunities, weaknesses, threats and strengths.

5.2.1 Opportunities

The lowest mean value for independent variable question is “Strong government support for

Halal development” with the mean value of 4.15. In case, respondents do not agree with it because

they think government do not give commitment and take responsibility in Halal food industry

development. Therefore, the government have to do some exhibition about it such as Malaysia

International Halal Showcase (MIHAS) by World Halal Summit, Halal Fiesta (HalFiest) and Malaysia

Agriculture, Horticulture & Agrotourism (MAHA).

In case, the government have Efforts involving dedicated Halal authority, Halal abattoirs,

food premises, Islamic tourism, Halal pharmaceutical and healthcare products, Shariah compliant

logistics activities, Halal market conventions and conferences are some of the many examples

initiatives by the government. In the year 1982, the Malaysia government under the Prime Minister’s

Department established a ‘Committee on Evaluation of Foods, Drinks and Goods Utilised by

Muslims’ which is now known as Department of Islamic Development Malaysia (JAKIM).

Presently, the roles and responsibilities of JAKIM are more than just a Halal certification authority.

JAKIM’s role in the Halal industry involves educating the public and industry players by producing

the Manual Procedure of Halal Certification Malaysia as well as publishing the guidelines for

Appointment of Foreign Islamic Organization as Halal Certification Body for Products to be exported

into Malaysia. In addition, Bohari et al. (2013) indicated that Halal certification from Malaysia is

more valid compared to those from non-Muslim countries.

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5.2.2 Weaknesses

The lowest mean value for independent variable question is “some of the Halal logo is fake”

with mean value of 3.85. There have some of the Halal logo that fake. The owner use this Halal logo

without permission or without qualification from the JAKIM. They use it to make profits to their

business which is can attract the Muslim people to buy from their businesses. Therefore, the

authorities must act more decisively and carry out regular monitoring so that no more products using

fake halal logo. Additionally, in order to avoid a confusion on the consumer part, all the supermarkets,

restaurant have to put JAKIM valid halal logo banner.According to Shafie and Othman (2006), the

reason for the use of fake Halal certification may be the result from slow and inefficient process of

Halal certification. JAKIM’s failure in providing a fast and prompt Halal certification application

process is because of the lack of full-fledged research and development unit as well as no support

from third-party experts from local universities in commissioning lab testing, analysis and on-site

inspection.

5.2.3 Threats

The lowest mean value for independent variable question is “Do not have Halal logo on the

packages” with mean value of 3.66. It means, the respondent think the halal logo is important which

can influence the customer to buy halal product. Therefore, the manufacturer must be put the Halal

logo on the packages before market it. This is because to avoid a doubtful of the customer towards

that product.

According to Talib et al (2010), has views that plastics or microwaveable containers or

carton boxes are largely used for packing food products and are considered safe from any non-halal

substance but still the packaging materials and its origin raises doubt. Furthermore, the production of

plastic packaging uses animal-origin gelatines, and this voids the halal status as there are no scientific

ways to determine if the gelatines are from properly slaughtered animals or not. Another popular form

of packaging is the metal cans. The production of metal cans uses oil as lubricant to assists during the

production process, and the origin of the lubricant comes from animals which the Halal status could

be in doubt. Besides that, according to Soong (2007), halal product packaging must consist of name or

brand of the product, minimum content in matric, name and address of manufacturer or distributor,

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list of ingredients, code number representing production batch and manufactured and expiry date and

Halal logo from recognized certification agencies.

5.2.4 Strengths

The lowest mean value for independent variable question is “Malaysian Halal certification is

perceived as more valid compared to non-Muslim country” with the mean value of 3.47. There will be

have process that must be followed to get the Halal certification for the company. Some people make

an expectation that money can buy Halal certificate and simply use it in their businesses. Therefore,

the government especially JAKIM must take an action to an individual or company that abuses or take

the easy way out in the Halal certificate.According to Bidin (2009), the Malaysian government has

actively provides incentives or grants scheme and other facilities with the aimed to develop its halal

industries. In the ASEAN region, Malaysia had been the most intensively positioning themselves to

be a hub for halal food in Asia and become the pioneer of halal certification standard globally.

Malaysia became the first country to have a governing body in halal industry and its halal business

blueprints provides clear goals and guidelines for the halal industry development.

5.3 CONTRIBUTIONS

5.3.1 To The Customer

The result from this analysis exposed information and awareness towards non-Muslim

consumer about the strengths that a company have in food industry which make them more compete

besides have produces product according to the Halal standards that has been strict. Besides that, they

also know the weaknesses that the producer have in a certain company especially in food industry.

Furthermore, consumer also can see the opportunities that the company have in term of providing a

product that has more quality but still involve in Halal perspective and know about the way of a

company overcome the threats that have been faces by the company itself.

5.3.2 To The Company

This SWOT analysis give enough information to the company on how their businesses

especially in food industry perform in the market. Besides that, they also can reduce or avoid the

weaknesses with make an improvement in providing the product but still in Halal Standards

guidelines. Moreover, they also can see the opportunities and have a method to get over the threats in

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achieving their goals follows the Syara’ perspective. Other than that, the SWOT analysis can make the

company increasing the efficiency and effectiveness of the business in terms of food processing

independent of dubious ingredients and always follow the standards that be appointed. Therefore it

will make the image of the company better known and protected from rogue elements.

5.3.3 Location

The result from this analysis is to provide information to residents of the states that

researchers have been select about the importance of the halal food industry in their daily lives. It is to

discouraging them from making a wise choice in buying food products for their healthy.Additionally,

the SWOT analysis is to make the states that researchers have chosen to focus more on priorities Halal

food industry because the majority population in these countries are Islam.

5.4 CONCLUSION

Researcher could conclude that all the factors that had been used in this study is important. In

another words, all independent variables that used are related to the increase rate of domestic tourism

in Malaysia. From the point of view of respondents, marketing factors is the most influential factors

follow by culture, economy and service. Besides, all factors are satisfied by the respondent where they

having a positive view or experience towards Malacca. Therefore, all the objectives are estimated.

5.5 OVERALL CONCLUSION

From the overall conclusion, the objective is achieved and shows that the four factors are

importance in affecting the increase rate of domestic tourism in Malaysia, Case Study: Malacca. From

the summary findings, it shows that there is positive effect between marketing, culture, economy, and

service.

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CHAPTER 6

IMPLICATIONS AND LIMITATION

6.0 INTRODUCTION

This chapter discusses the result of the research on the implication and limitation. The

scope of discussion centers on the implication and limitation of this research. This chapter

focuses on the implication of the research to the consumers towards the Halal food in four

states that the researchers have been chosen.

6.1 IMPLICATION FOR THE CUSTOMERS

The consumers have to be clear about what of the Halal food is. It is important for

them especially the non-Muslim consumers on their view about Halal food industry.

Throughout the SWOT analysis, they can know the overall information about the Halal food.

In strength, the Halal food shows that the certification of the Halal food is valid especially in

Muslim country. So, any of the consumers can eat the food without any confusion. However,

it is also shows the weakness of the Halal food whereas the using of the Halal logo was being

fact. So, it can give impact for the consumers especially the Muslim consumers which is can

hesitate the confident of the consumers to eat the food. So, this kind of problem, JAKIM

especially should be more alert and take the seriously step to solve this problem in order to

get the confident consumers back.

The next one is opportunity, whereas the Halal food industry has the strong supported

from the government. So, when the supported from the government, more Halal food has can

be produced. Last one that can be impact to the consumers in term of SWOT analysis is

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threats. In this last part, the existence and emergence of Haram and doubtful substance for

surely can give the big implication to the consumers. Nowadays as we can see at certain

supermarket, the seller has sold the Haram and Halal food in one place or line. So, the

consumers especially the Muslim cannot buy the food as well as reduce their trustworthy

towards the Halal food.

6.2 LIMITATION OF THE STUDY

While the researchers conducted a study on consumer perception towards halal food industry

in Malaysia, researchers can identify some limitations when distributing questionnaires to the

respondents in the states involved. Among them, the respondent did not cooperate when distributed

questionnaire because busy with other work. In addition, respondents were also not paying attention

and interest to the questions that were asked. Next, there are some respondents also consider research

as an insurance agent when distributed questionnaires. In addition, there are those who did not

understand the questions asked and cause them only a cursory read without reading them carefully.

6.3 CONCLUSION

SWOT analysis being help the consumers in order to know more about the Halal food

industry as well. The researcher has felt that there has to be a better system in order to make

the consumers more clearly to understand what the Halal food is. So, the government as well

as JAKIM should be more corporate in order to make the consumers understand by doing

several activities such as campaign, talk, forum and others that related to the Halal food

industry.

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CHAPTER 7

FUTURE RESEARCH AND CONCLUSION

7.0 INTRODUCTION

This chapter discusses the future research and conclusion. The scope of discussion

centers on future research and conclusion of this research. This chapter focuses on the future

research and conclusion for the researcher.

7.1 FUTURE RESEARCH

Future researchers can use the same topic in different of the independent variable.

Other than that, the respondents should be more than 100 to ensure more accurate results.

7.2 OVERALL CONCLUSION

In conclusion, the overall average mean value is high which is shown the consumers

get more information and knowledge toward the SWOT analysis about the Halal food

industry. But, some consumers were not satisfied with the SWOT analysis in term of

weaknesses and threat. So, the government and JAKIM should corporate together to solve the

problem that faces by the consumers and also the Halal food can be merging into the market.

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