Buy Malaysian drive an uphill battle, says KPDN

PUTRAJAYA: The escalating humanitarian crisis in Palestine since early October has ignited a global wave of boycotts against Israeli goods and international brands with alleged Zionist links. Malaysians have also rallied to boycott products and companies with ties to Israel as a symbol of solidarity with Palestine.

At the same time, Buy Malaysian campaigns are also gaining traction with lists of locally produced goods ranging from food products to essential items as well as household goods including Malaysian furniture brands flooding social media.

The situation is a blessing in disguise for local manufacturers as Malaysian consumers shifted their preference for local products which are on par with international brands, with many of them recognised globally.

Noting the positive development, the Domestic Trade and Costs of Living Ministry (KPDN) sees the situation as the best opportunity for local manufacturers to leverage the existing platforms to promote their products.

“The boycott issue is rather sensitive and it is within the consumer’s rights. The ministry has to take a neutral approach as we have a role to play in protecting (the interests of) local products as well as foreign goods; local businesses can seize the day by promoting their goods as substitutes for foreign products that are shunned by buyers,” KPDN Trade, Distribution and Business Sector senior director Datuk Rohaizi Bahari told Bernama in an exclusive interview recently.

Given the current scenario, he hopes demand for local products could be sustained and not seasonal, noting that local entrepreneurs should also improve the quality of their products and services to be comparable with foreign products and offer affordable prices.

There is no doubt the quality of local products has evolved over time especially in product development including packaging, design and product certification marks, which indicate the products have been tested and certified to meet specific standards or requirements, both locally qnd at the international level.

Against this backdrop, the ministry says encouraging the public to buy local goods has been an uphill battle as the products and services are not widely marketed and are not aggressively promoted.

Having gone through a long process of bringing the product to life and testing does not mean the local manufacturer’s journey is over. Getting it on store shelves or at major supermarkets as well as at premium areas is the next big leap. In a fast-paced and competitive world, manufacturers of unknown brands have to take a backseat as their products are not well positioned to attract local buyers.

It is no wonder that the Buy Malaysian Goods Campaign (KBBM), which entered its 39th year, has not achieved its target of fuelling the patriotic spirit among Malaysians to buy and use domestic products or services.

In fact, the campaign, which kicked off in 1984 and was rebranded in 2009, had introduced various strategic initiatives to stimulate domestic economic growth through boosting consumption of local goods.

“In Malaysia, given the choice between imported and local products, consumers tend to favour foreign items, a far cry from the situation in Thailand as patriotism is ingrained in the Thai society, which gives priority to its own products.

“In Thailand, many of their products are promoted and are placed at premium locations such as inside the airport, major supermarkets as well as at the entrance of shopping premises,” he said.

The high awareness among Thais in their preference for local products can be attributed to the country’s policy, which makes it compulsory for manufacturers and traders to give priority to local goods over imports.

In Malaysia, there is no specific policy in encouraging the use of local goods and to date, only the Buy Malaysian Products campaign is leveraged to raise awareness among the public as well as manufacturers.

KPDN is currently improving its marketing strategies and increasing the use of local products including collaborating with major supermarkets, convenience stores and retail outlets at petrol stations.

To date, said Rohaizi, the ministry has entered strategic partnership with 16 leading local retailers such as Lotus’s Malaysia, Mydin, KK Supermart, Petronas Mesra for the KBBM.

At the same time, the ministry has also established cooperation with online marketplace such as Shopee, Lazada and PG Mall to help revive the domestic economy and the people’s acceptance of Malaysian goods.

“We have taken our marketing strategies for local products and services to the next level with focus on premium places as consumers would have more confidence in products that are marketed at such locations. Prior to this, it was difficult for local products to penetrate premium supermarkets due to the stigma attached to local products.

“However, we can’t blame them (supermarket owners) as several aspects have to be weighed in among others, whether the local products in terms of quality are suitable for placements there; and can the local items be assured of their availability at the point of sale on a continuous basis,” he added.

Under a two-pronged strategy, marketing of local products at premium supermarkets is poised to improve product visibility given that major retailers such as AEON and Lulu serve as the gateway to the global market through their retail network which has its footprints in various countries.

In fact, many Malaysian brands have carved a niche for themselves and making their presence known globally with inroads in countries especially in the Middle East through such collaboration. As such, the ministry says it is looking at the situation from all angles, especially in terms of product development and quality improvement.

Towards this end, KPDN strives to assist local manufacturers in improving the quality of their products and services based on certain standards through consultancy, continuous training and business matching with key retailers in the country.

Besides physical marketing, emphasis is also given on the importance for manufacturers to tap the digital ecosystem and e-commerce infrastructure by adapting their products to reflect lifestyle changes and current trends.

As such, Rohaizi opines that e-commerce transactions on the social media platform TikTok Shop in Malaysia is not a “threat” but the best opportunity for local entrepreneurs to market their products and services widely and more effectively.

According to media reports, neighbouring Indonesia has banned TikTok Shop in the country as it is seen as a threat to local traders while Malaysia has yet to make a decision on the matter. Malaysia is reported to be still studying the possibility of regulating TikTok and its e-commerce features.

“The purchasing behaviour of Malaysian consumers especially the younger generation has shifted in favour of online retailers on social media such as TikTok, and as such KPDN is of the view that our local manufacturers should take the opportunity to maximise the promotion of their products,” he added.

Given the latest trends, the ministry has also injected a new lease of life into KBBM by empowering the campaign through the Malaysian Goods Carnival (KBM) 2023 to directly inculcate patriotism among Malaysians towards local brands.

This includes organising five series of KBM mini tour at premium supermarkets across the nation covering north, south, east coast zones as well as Sabah and Sarawak, drawing participation from 18 to 22 local entrepreneurs to ensure these products are accessible to the people.

The mini carnival’s grand finale will be held at IOI Grand Exhibition & Convention Centre, IOI City Mall, Putrajaya on Dec 13. More than 100 exhibitors will participate in the five-day mega event through various clusters nationwide.

Themed the exclusivity of Malaysian products, the carnival, which includes exhibitions and sales promotion, also serves as the best platform for local entrepreneurs to boost their sales to a wider market through the business matching segment.

But the question arises, will the carnival be able to achieve its objective given the people’s purchasing trend has been declining post Covid-19?

“Without a doubt, consumers’ purchasing trend post Covid-19 has been declining due to several factors such as the rising cost of living and the economic slowdown, which forced many Malaysians to start saving for their everyday survival.

“The overall sales value generated from KBBM last year recorded a slight drop to RM2.7 billion compared with RM3.2 billion in 2021,” he said, adding that the decline was due to the lower allocation received while several large corporations could not participate in last year’s event.

Despite the lower sales, the total value of stock-keeping units (SKUs) in 2022 grew 67% to 3,871,128 from1.07 million in 2021.

The sales performance shows that while more new products have entered the market, consumers’ purchasing power is still at a low ebb due to the global financial crisis.

To address the issue, the ministry has embarked on more programmes, including holding KBM carnivals nationwide to create awareness of quality Malaysian goods as well as to encourage Malaysians to shift their preference by buying local as substitute for imported items.

“The government’s move in empowering the KBBM through various strategic initiatives, such as the KBM carnival tour, is aimed at mitigating the challenges and pressures of economic globalisation particularly to boost and stimulate the domestic economy through increasing the purchase and use of local products or services.

“For this year, we have visited five zones across the country through our mini tour series before the grand KBM finale this month. It is hoped that the implementation of KBBM strategic initiatives would be able to boost the people’s purchasing power as well as to attract public interest in local products,” he added.

Besides the KBM tour, other strategic initiatives which have and will be undertaken include themed sales based on special segments. For this year, the segments selected are fashion and handicraft to provide a platform for local industries that are less exposed to promote their products through KBBM.

The ministry has also established a strategic collaboration with animation companies through the development of an animation slot to inculcate the spirit of patriotism among the younger generation.

“On behalf of KPDN, I would like to call on Malaysians as well as those abroad to support the campaign themed Jom Sokong dan Beli (Let’s Support and Buy) by buying Malaysian products which are of quality and are on par with foreign goods.

“We should embed in our minds (the need) to embrace Malaysian-made products.

“Show your love and support for Malaysian products. If we don’t do it, who else?”