READINESS FOR HALAL CERTIFICATION: IMPACT OF ANNUAL SALES ON SMES IN SELANGOR

Abstract

This study examines the influence of annual turnover on the willingness of product-based small and medium enterprises (SMEs) in Malaysia to become halal certified. While SMEs generally show a positive attitude towards certification, the results indicate that actual willingness is significantly influenced by company size, especially turnover level. The descriptive analysis shows that SMEs with medium turnover RM3 million to RM14.9 million score the highest on willingness, suggesting that companies in the growth phase are more strategically inclined towards certification initiatives. A one-way ANOVA confirms that annual turnover has a significant impact on readiness, emphasising the importance of financial capacity in facilitating certification engagement. Supplementary non-parametric tests Kruskal-Wallis and chi-square show turnover-related differences in the dimensions of readiness, particularly in commitment and persistence. Medium-sized companies show stronger commitment but lower persistence, possibly due to resource constraints and changing strategic priorities. Other dimensions of readiness such as accountability, willingness, competitiveness, compliance, influence and trustworthiness remain consistently high across all turnover categories, reflecting a strong ethical and market-orientated motivation in the Malaysian SME sector. These findings are relevant for policy makers and industry players. Tailored policy approaches are recommended to improve readiness across all SME segments, with a particular focus on medium enterprises that have to cope with the twin challenges of limited resources and the need for scalability. Consistent trustworthiness and compliance at all turnover levels illustrates the deep cultural and institutional integration of halal values an advantage that can be leveraged to increase the uptake of certification. While financial scale influences certain aspects of readiness, the sector’s widespread positive attitude towards halal certification provides a promising foundation for expanding the halal certification landscape in Malaysia and strengthening its competitive position in the global halal economy through inclusive, scale-sensitive strategies.