Running Business on Halal Concept

Halal business concept has been getting more traction, with more producers wanting to have their products halal-certified. Nowadays, it’s not only food, beverages, cosmetics, and fashion producers that go after the halal label, but also business players in tourism and entertainment sectors, and even digital products.

This is driven by the increase in popularity of halal lifestyle among the people. The increasing number of digital contents from vloggers about halal lifestyle also boosts this phenomenon.

“Furthermore, products with halal concept attract many customers, regardless of their religious background, for their transparency, processing safety, and service,” Dr Jonathan AJ Wilson wrote in Marketeers magazine July 2017 edition.

More and more halal products of various categories enter the market, in connection with each other. The halal standards are observed by businesses, from raw materials, processing, service, to finance.

“Interestingly, halal consumption by the people has spread to various countries, and the inter-related (halal) industry sectors record value of up to trillions of dollars,” Wilson continued.

Indonesia has such a big market for halal products, but there are various challenges to overcome still. Currently, according to Global Islamic Economic Report 2016/2017, in terms of sharia economy, Indonesia sits at number 10, after Qatar and Jordan.

According to Indonesia Halal Watch (IHW) Executive Director Ikhsan Abdullah, domestic halal industry still has to overcome many challenges, including raising the awareness and concern of the public towards halal products.

“Indonesians tend to still have low awareness about halal products. Indonesians think that all products in the market are halal,” Ikhsan told, Monday (April 16).

Competition in the halal industry also gets fiercer. Technology and free trade have opened trade channels. Domestic halal products have to compete with foreign halal products.

But a challenge is not an obstacle. The big potential market can become a golden opportunity for Indonesian business players. The market demand grows, creating new opportunities, including the need for trusted halal transportation.

TRAC is not willing to waste the opportunity. As a business unit of PT Serasi Autoraya (SERA) operating in trusted vehicle rental, TRAC offers a sharia-compliant car rental service for corporations.

TRAC Syariah is the first product in Indonesia that legally provides ijarah service, vehicle rental activities that are compliant to Islamic laws.

All vehicles are procured in a halal way through a mudarabah mechanism in which the profits generated through joint use of capital are shared according to mutual agreement. The partnership is also protected by sharia-compliant insurance.

TRAC Syariah is also transparent about the fund used for managing the vehicles, which can also be developed into a mudarabah product with profit-sharing concept.

The new service itself has obtained a recommendation from the National Sharia Council to run a sharia-compliant car rental service business, as inked in a recommendation letter issued on November 7, 2016.

Thus, the public can enjoy halal service from a trusted transportation company. For further information on other SERA business units, please click this link.