Halal becomes big business

Halal becomes big business
halalWhen my local delicatessen in France closed, it was replaced by a fast-food outlet selling halal fried chicken. When my local kosher butcher closed, it was replaced by a halal butcher. In my local supermarket, there is now a well-stocked halal section. Last week, I received a leaflet proposing Islamic banking services. Suddenly it seems halal has not only become fashionable but big business.

Halal fast food certainly sells. For a start, in many parts of Europe the late night staple is the kebab. That it is halal hardly matters to non-Muslim partygoers who stumble out of nightclubs hungry for a meaty sandwich in the early hours. It’s a noteworthy trend that extends beyond the humble kebab: Halal food is popular with both Muslims and non-Muslims.
But the main market is clearly Muslims eager to eat in line with their religious precepts. And a big market it is. There are 1.6 billion Muslims worldwide. In Europe alone, there are 18 million Muslim consumers with an estimated market value of $2.63 billion per annum according to Halal Journal.
That’s an attractive and growing market that the big multinationals have been quick to cash on. Nestle was among the first to identify the potential. It started selling halal versions of their most popular products such as kit-kat chocolate in the 1980s. Halal products now account for five percent of Nestle’s annual sales, or 5.3 billion Swiss francs. Eighty-five of their factories have halal— certified production lines and of these 20 are in Europe. More important, it is a fast-growing and highly profitable sector. Nestle reports that its latest marketing campaign for halal products led to 50 percent annual growth and double-digit profitability.
Several fast-food chains have been quietly incorporating halal food onto their menus or sourcing halal meat and chicken. KFC, for instance, uses halal chicken. Others have done so not so quietly. There was uproar last year when Dominoes Pizza turned one of its outlets in Birmingham halal. Similarly in France last month, even politicians joined the outcry when Quick — a Belgo-French hamburger chain similar to McDonald’s — turned eight of its outlets into halal restaurants. It was discrimination, they argued. It is one thing to sell halal food, it is another to deprive non-Muslims of pork products.
The argument is not without merit. Surely locals who want to have bacon on their burgers should be able to do so, just as Muslims who would like their burgers made of halal beef and served with turkey bacon instead of pork should also be able to get what they want. Except that it doesn’t quite work that way. Adding a couple of halal items on the menu is not as successful as going halal. The first may attract one or two customers who fancy turkey bacon on their burgers. The second attracts a whole segment of society once they know all the food being served conforms to their religious requirements, not only because it is pork-free but because the restaurant has gone all out and installed procedures to ensure that Muslim hygiene standards have been maintained in the entire production line. And it works. It is rumored that Quick saw a 30 percent increase in sales in the eight stores that went halal.
The key is segmentation. To increase sales, targeting a particular sector of the market is textbook stuff. When Muslim consumers make up such a dynamic, increasingly wealthy and culturally visible segment of the consumer market, it makes sense to market products just for them. Whereas it used to be just small independent butchers selling halal meat and chicken, it has now become much more developed and highly profitable.
What surprises me most about the halal business is how it has expanded beyond the obvious sectors of halal meat and food. There are now halal cosmetics, halal vitamin pills, halal financial products, halal hotels and resorts. It is fast becoming a brand. Rather than call a hotel Muslim-friendly because it does not serve alcohol, it is branded as halal, a word I would once only have used that way about meat or food.
The halal business has become highly sophisticated. In Malaysia, there are Halal Parks, described by the Malaysian Halal Industry Development Corporation as “communities of halal-oriented businesses built on common property where they are provided infrastructure and service support.” Malaysia is building 20 such parks. And in June this year Malaysia will also host the 5th World Halal Forum in Kuala Lumpur. Last year, more than 900 participants attended the event, from more than 47 countries. One of the key questions that will be addressed is the issue of creating an international halal standard.
Going halal is the next big thing and it’s clearly an encouraging trend. However, as it stands a hefty 90 percent of the global halal market is controlled by multinationals such as the food giants Nestle, fast food outlets like KFC, or supermarket chains such as Carrefour. The halal bandwagon is out there and going fast, but Muslims aren’t running it.

Iman Kurdi

*Published in the Saudi-based ARAB NEWS on April 4, 2010.

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