Photo: MyOutlets' Global Halal Hub in Singapore. Photo courtesy MyOutlets
After opening Singapore’s biggest all halal-certified foods supermarket, MyOutlets quietly launched its global e-marketplace Haladeen. Unlike its halal e-commerce competitors, the company is banking on an offline-to-online play to win the international halal food and beverage market.
In late 2016, halal grocery company MyOutlets opened Singapore’s biggest all halal-certified foods supermarket named Global Halal Hub. The 10,000-square-foot store opened carrying halal food products from a variety of countries, including Australia, India, Japan, Korea, Malaysia, Singapore, Thailand, Turkey, and the U.S.
Outside of Southeast Asia’s richest city-state, MyOutlets has also opened up Global Halal Hub supermarkets in Seoul, South Korea and the city of Chiba in Japan.
The company projected $9.5 million in sales turnover during its first year for the Singapore store and claimed to be targeting $36.5 million by the end of 2018.
MyOutlets Chairman Ronnie Faizal Tan told Salaam Gateway that Global Halal Hub in Singapore remains on track to reach its revenue goal.
“Since the opening of MyOutlets’ Global Halal Hub supermarket [in Singapore], customers have been pouring in. They are comprised of 80 percent Muslim customers and 20 percent non-Muslim customers,” said Tan, adding that the Bedok location also features a 2,000-square-foot area for country-specific halal events and bazaars for SMEs to showcase their products.
OFFLINE-TO-ONLINE FOR GLOBAL PUSH
Shortly after opening Global Halal Hub, MyOutlets quietly launched its e-marketplace called Haladeen in February 2017.
The multi-vendor platform is designed for halal buyers and sellers across the spectrum. It offers a multifaceted business model, facilitating business-to-business (B2B), business-to-consumer (B2C), and consumer-to-consumer (C2C) transactions.
Focusing solely on halal products and services, Haladeen already has global reach, claimed Tan.
“Haladeen consolidates global halal products and services and sells directly to B2B and B2C markets globally,” said Tan. “Since we launched, we have attracted more than 500 vendors from Singapore, Malaysia, Japan, Turkey, Italy, the Philippines, and Thailand. They market their products inside Haladeen.com/B2B. We estimate the site will reach at least 1 million users over the next three years.”
Tan added that Haladeen is outfitted with more than 25 languages so as to eliminate communication barriers between international buyers and sellers.
The market potential for a cross-border online marketplace for halal vendors is significant. Muslims around the world spent $1.17 trillion on food and beverages in 2015, and this is projected to grow by a 9 percent CAGR to reach $1.9 trillion by 2021. The revenue for halal-certified F&B was estimated at $415 billion in 2015.
The value of halal products traded via e-commerce was estimated at $123 billion in 2015 and is expected to reach over $230 billion in 2020.
These are staggering numbers for Islamic economy vendors looking to grow their companies’ footprints globally. In terms of how big grocery players will connect to the smaller, more niche halal providers in Muslim-majority markets, that’s where Tan hopes Haladeen will one day surge.
Haladeen is still a three-month-old start-up trying to find the right footing. Tan claimed to be encouraged by Haladeen’s performance so far, however, adding that MyOutlets has listed its products on the platform and enquiries have come in from around the world, expressing interest.
Even with a potentially game changing e-commerce play in the oven, MyOutlets is still hustling with its ground game. According to Tan, there are more than 1.5 million Muslims in Singapore, which includes citizens and foreign workers.
Tan is not shy about the fact that MyOutlets is looking for external money to fuel international growth.
“Due to our expansion mode, we require more funding to grow. Unfortunately, we do not have support from local government agencies nor Islamic financing. But interestingly enough, we’ve actually brought in interest from non-Muslim business players. More than 80 percent of the world’s halal products are manufactured by non-Muslims to cater to the current global Muslim population.”
In Singapore, MyOutlets competes with a few different players on separate fronts.
In e-commerce, Haladeen is going up against B2C Singapore-focused HalalMarket, which enables distributors to ship halal products directly to customers.
Indirectly, Haladeen competes against Halal Dining Club, which is a site and app for booking and reviewing halal eateries and restaurants in Singapore, as well as the UK. The site can be seen as a contender because it is attempting to divert dollars spent on halal groceries toward eating out instead.
Naturally, Haladeen is also going up against RedMart, arguably Singapore’s most mature, well-funded, and reliable name in online groceries that also carries a variety of halal products. It has disclosed $59.9 million in venture funding from a slew of famous investors. Most recently, Alibaba-backed Lazada acquired a majority ownership stake in RedMart in November 2016. The size of the deal was never officially disclosed, but TechCrunch believes the deal landed somewhere between $30 and $40 million.
In terms of brick-and-mortar contenders, Global Halal Hub sees competition from any supermarket that sells halal products in Singapore, despite MyOutlets’ halal-only market position.
Globally, Haladeen is up against only a handful of sites, all Malaysia-based.
Its biggest B2B competitor, DagangHalal, is also the Islamic economy’s most established B2B online e-commerce platform. DagangHalal listed on London’s ISDX Growth Market last year, floating almost 60 million ordinary shares to give it a market capitalization of approximately 14.6 million British pounds. The site also has its sights on a move into B2C.
If Haladeen and MyOutlets are in want of institutional backing and funding, DagangHalal in comparison has strong state support. It is backed by the Malaysia Technology Development Corporation, a wholly owned subsidiary of the country’s sovereign wealth fund Khazanah Nasional Malaysia, and its Halal Verified Engine (HVE) is supported by the Department of Islamic Development Malaysia (JAKIM), the country’s national-level halal certifier.
DagangHalal has never disclosed its user numbers but a scan of its site reveals over 21,000 halal products from over 4,000 sellers. In April 2016 it said it aimed to attract 60 million users and more than 300,000 halal suppliers to register under its HVE, which identifies authentic halal-certified products and halal food premises worldwide.
Haladeen also competes with Zilzar, another B2B halal e-commerce site that was once frequently in the media’s eye. Launched in October 2014, Zilzar reported in October last year it had around 2,800 halal suppliers on its site. The start-up is undergoing a transition with the departure of founding CEO Rushdi Siddiqui in February this year.
Haladeen also competes with AladdinStreet, which launched early last year to a lot of fanfare. It set itself high stakes when it said it would onboard more than 60,000 halal merchants from around the world in its first phase of development and that it would spend $100 million for global branding, advertising and promotions. Co-founder Desmond To told Salaam Gateway in April last year the company aimed to make $750 million in revenue within its first year of operations.
As a comparison, 10-year old DagangHalal earned revenues of 4.64 million Malaysian ringgit ($1.08 million) in 2016, down 16.7 percent from the previous year. AladdinStreet has been noticeably quiet since its big announcements last year. The most recent reports on its number of sellers come from October 2016, when the company claimed to have locked in 60 halal merchants.
How will MyOutlets cope with stiff competition from other halal e-marketplaces?
“Each [player] has their own [strategy]. Haladeen is a multi-vendor platform and we screen through our vendors before approving their posts. Haladeen offers a direct approach for vendors to reach businesses or their customers,” said Tan.
“Haladeen will be more than just a marketplace, as we are developing many other apps and functions too, such as social networking, education and an Islamic financial platform,” added Tan.
© SalaamGateway.com 2017 All Rights Reserved