Ghazali & Ruslan/CSSR/UiTM’09

Re-Branding On Small and Medium-Sized Enterprises (SMEs) for Export

A Case Study: Malaysian Food Products

Ghazali Hj Daimin and Ruslan Abd Rahim

Faculty of Art and Design
Universiti Teknologi MARA (UiTM)
Shah Alam, Selangor
Tel. 03-5544 4001, Fax: 03-5544 4011
ghazalid@salam.uitm.edu.my
ruslan@salam.uitm.edu.my

ABSTRACT

The forces of globalisation in business today has pushed Small and Medium-sized
Entrepreneurs (SMEs) of Malaysia to change their mechanism and strategies in order to
penetrate the global market. Business strategy now is becoming more dynamic and
competitive especially at an international level. Due to this, the Small and Medium-sized
Entrepreneurs (SMEs) in Malaysia urgently needs an exclusive approach and creative strategy
to support their business to expand internationally. The SME players also need to be alert that
today’s business environment has changed much compared to the past. Therefore, customers
are becoming wiser in terms of selecting a product that catches their interest in the market.
The demand on product quality and value has always been the main issue.

Though many large Malaysian companies are already established at the international scene,
the big question is how entrepreneurs from the Small and Medium-sized Entrepreneur groups
(SMEs) can be a global-player by exporting their food products in the global market.

This paper aims to study the creative elements of re-branding in realizing a winning formula
for Malaysian Small and Medium-sized Entrepreneur (SMEs) to be global players. As with
other business element like marketing and quality, re-branding is also perceived as an
essential element to pave the way for Malaysia SME food products to be placed globally. In
food product business scenario, it is foreseeable that re-branding will be the major factor for
the Malaysian SME players to place their food products at global scene. With no compromise
in terms of quality of food products together with smart marketing strategy, re-branding is the
real key of success for Malaysian SMEs at the global market scene. Recognizing the
importance of re-branding process for Malaysian SME players, this research paper will be
focusing specifically on Malaysian entrepreneurs from the group of Micro-size Entrepreneur.

Re-branding will see the introduction of the philosophy of re-branding and its relationship
with the Malaysian SMEs food products. There are three elements of qualitative methodology
paradigms such an observation, archival data together in-depth discussion will be used used

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towards finding the essential elements of re-branding to be implemented for Malaysian SME
food products towards global market-place.

Keywords: RE-BRA%DI%G, SMALL A%D MEDIUM-SIZED E%TERPRISES

(SMEs), EXPORT and MALAYSIA FOOD PRODUCTS.

Definitions for Small and Medium-sized Enterprises (SMEs) in Malaysia.

(Table I)

Category MICRO-SIZED Small-sized Medium-sized

E%TERPRISE Enterprise Enterprise

1.

Manufacturing, Sales turnover of less Sales between Sales turnover

Manufacturing-related than RM250, 000 or RM250, 000 and less between RM10
services and agro- full-time employees than RM10 million or million and RM25
based industries less than 5. full time employees million or full time
between 5 and 50. employees between 51
and 150.

2.

Services, primary Sales turnover of less Sales turnover Sales turnover

agriculture and than RM200, 000 or between RM200, 000 between RM1 million
information & full-time employees and less than RM1 and RM5 million or
communication less than 5. million or full time full time employees
technology (ICT) employees between 5 between 20 and 50.
and 19.

Sources:

1-+ational Small and Medium Enterprise (SME) Development Council under Bank +egara of
Malaysia (B+M), 2006

2-Small and Medium Industries Development Corporation (SMIDEC), 2006

Re-branding will see the introduction of the philosophy of re-branding and its relationship
with the Malaysian SMEs food products. There are three elements of qualitative methodology
paradigms such an observation, archival data together in-depth discussion will be used
towards finding the essential elements of re-branding to be implemented for Malaysian SME
food products towards global market-place.

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2) Introduction

Small and Medium-sized Enterprises (SMEs) form a vital part of any national economy.
According to the Organization for Economic Cooperation and Development (OECD),
Malaysian SMEs comprise of about 95 % of enterprises in a nation, and are responsible for
employing 60-70 % of the country’s workforce (OECD, 2002). SMEs are mushrooming in the
country today and they have an important role in contributing to the rapid development of the
country’s economy.

Almost every business whether small, medium or big has a trading name. Customers know
the existence of a product in the market through the product’s name or logo. This name for
products has come to be known as brand. The more creative the brand name, the more people
will be attracted to buy the product or service. Andrew Bradley, a partner at the advertising
agency Bradley, McGurk Partnership, believes that “the role of branding in relation to SME is
firstly to communicate the personality of the business and to build on that” (The Post, 2005).
These experts pointed to the importance of branding in the SME industry and it is felt crucial
for Malaysian SMEs to re-look at their branding strategies and embark on a re-branding
exercise. This investigation embarks on a mission to re-brand the small and medium
enterprise food products in Malaysia because it is strongly felt that the re-branding exercise
will benefit the SME players and benefit the country’s economy.

Deputy Prime Minister of Malaysia, Dato’ Seri Mohd Najib Bin Tun Abdul Razak called for
Malaysia to brand itself. He urged producers to make the country more attractive in an
increasingly globalised arena, to brand Malaysia so that the country can be characterized by a
well recognized competence (Branding Malaysia, LS Sya, p. 11, 2005). That statement
highlights that Malaysian players in any industry are still searching for their own image or
identity as a tool in order to market their food products of an international level. Prior to that,
Malaysians have to accept the fact that, until today, there are only a few Malaysian SME food
products producers (medium entrepreneur category, not from small entrepreneur category),
which are well established and recognized at international level. For example, the Dewina
Food Industries Sdn. Bhd which was established since 1986 (Company Profile: Dewina Food
Industries Sdn. Bhd, 2007) and became a pioneer in the manufacturing of premium quality
convenience food in retort pouch through the brand name of Brahim’s. Amongst the company
food products are from category of Asian foods, Precooked and Gourment, Processed Food
and Sauces (www.brahimsfood.com). Since 1986, this company has been practicing the re-
branding exercise for their food products in order to upgrade its packaging design towards
international market. As Temporal, P. said in his book;

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“Developing an Asian Brand is not easy. Poor image of “Made in

Asia,” coupled with small domestic markets,
have been the source of problematic business growth for many
Asian companies”.
(Branding in Asia, 2000, p. Foreword)

Picture-1 illustrates several examples of local food products from local companies (medium-
category) that have successfully exported their products in the local as well as international
market. This success is contributed through the company’s initiative in practicing re-branding.
Firstly, the researcher presented samples of the food packaging from Brahim’s brand. The
evolution of the re-branding and design of the packaging has clearly transformed the products
into better looking image. Since its development in 1986, Brahim has gone through several
phases of re-branding in order to penetrate global market such as Indonesia and Thailand. The
re-branding process saw improvement in terms of structural design, color and graphics.
(www.brahimsfood.com). The pictures on the next page show the sequence of transformation
that has taken place on the food packaging of DEWINA Food Industries Sdn. Bhd.

Picture-1: TRA%SFORMATIO% OF PACKAGI%G AS A RESULT OF RE-BRA%DI%G

PROCESS O% FOOD PRODUCTS OF DEWI%A FOOD I%DUSTRIES SD%. BHD.

a) Kari Ayam Hijau b) Kuah Masak Lemak c) Malaysian

(1980’s) (1990’s) +yonya Sauce (2000’s)

Another local food products brand, which had practiced re-branding exercise, is called
Munchies Food Products (picture-2). After re-branding process, this brand has been quite
popular in ASEAN countries like Singapore and also Thailand (+ew Straits Times, Saturday,

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April 1st, 2006). Historically this brand was introduced in the food product local scene in
2005. Like DEWINA Food Industries, this brand has also been involved in re-branding
process in order to attract more people to become loyal customers for its products.

Picture-2: Hwa Tai’s Products

The time has come for Malaysian SME small group entrepreneurs to take an aggressive
initiative or appropriate method to re-brand their food products to be internationally accepted
whether in the Middle East, Europe or the United States. In this scenario, the Malaysian
SMEs players need to think of their identity and also the quality of the food products. By
having a good name for the food product or company’s name, together with the quality of the
product, the Malaysian SMEs can then consider to take their food products to the open market
and compete with international food products. Besides that, producers of Malaysian SME
food products need to strategize their branding by studying or searching for a new method in
order to market their food products at international market.

3) BACKGROU%D OF THE STUDY

The Prime Minister of Malaysia, YAB Dato’ Seri Abdullah Bin Haji Badawi in his
speech at the National Branding & Packaging Innovation Exhibition & Conference 2005 at
the LimKokWing Institute of Creative Technology, CyberJaya made a serious comment on
product branding in Malaysia. He said that Malaysia lacks the know-how’s required to
develop and implement successful branding and packaging strategies. The Prime Minister
stressed,

“Branding and packaging are fundamental aspects of successful business, which

large Malaysian companies as well as SMEs must seriously adopt and integrate into
their current business practice. We must work to develop the capacity of Malaysian

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enterprises and enable them to roll out packaging and branding of their products and
services that can compete at all levels”.

(Prime Minister’s Speech, National Branding & Packaging Innovation Exhibition &
Conference, August 11th, 2005, Prime Minister Department’s Press Statement and
http://www.pmo.gov.my/WebNotesApp/PMMain)

The Prime Minister’s comments drove home the point that the branding and packaging
designs of Malaysian Small and Medium-Sized Enterprise (SME) food products are lagging
behind brands from abroad. Brand names like Pizza Hut, Heinz, and Cadbury’s Chocolate
have been imported into Malaysia and they are now mushrooming in this country to meet
demand from consumers. All these international brand names are already established in the
Malaysian market. This is due to the tremendous growth of major international retailers in
Malaysia like Carrefour, Makro, Dairy Farm International (consists of Cold Storage and Giant
outlets), Tesco and also Jusco since 1990 (info@austrade.gov.au).

Dato’ Seri Mohd Najib Hj. Abdul Razak, the Deputy Prime Minister of Malaysia, during his
speech at the opening of Showcase ‘One Product One District’ (Satu Produk Satu Daerah), at
the Melaka International Trade Center (MITC) on April 6th 2006, cited one instance when he
was travelling on a domestic flight. He expected to be served local products like ‘Seri Kaya’
spread during the flight but instead he was served imported food products like strawberry jam
and a few others. (Local +ews, TV3 Buletin Utama, 8.00 pm, April 6th 2006). It is observable
that, in promoting local food products to the international customers, local carrier companies
like MAS and Air Asia can play their role by serving local food products in their domestic
route and or international route.

Meanswhile, Minister of International Trade and Industry, Datuk Seri Rafidah Aziz cited that
most Malaysian companies are not investing enough in brand building and development.
According to statistics for the period of 2004 to June 2007, a total of RM79.6 million under
the grant had been approved to 45 companies, in which small and medium scale enterprises
(SMEs) accounted for RM28.6 million or 40 percent of the total approved amount. But the
utilisation rate was low at 26.1 percent of the total approved amount (Bernama, July 10,
2007). Investment in brand building and development will enable the firms to create user
awareness and loyalty for their products and services whether local or international
marketplace. She also added that local companies need to rethink about their approach to
branding or lose out in the current competitive market (Business Times Malaysia, +ST, 2004).

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This is very important for Malaysian SME players especially from small and medium group
including micro entrepreneur groups towards becoming a part of global players.

As one of the developing countries in the world, Malaysia has improved in her import and
export ventures. The Federal Agriculture Marketing Authority (FAMA) has projected the
market potential of Malaysian food products for the year 2010 as in Figure 1.

Figure 1: The Market Potential of Malaysian Food Product in the year of 2010 (RM/billion).

(Source: Utusan Malaysia, Thursday, June 29th 2006, p. 14).

It is predicted that potential market for local food products in Malaysia will increase by 2010
based on domestic distributors. For example, revenue from livestock is predicted at 41.21
percent, fishing at 31. 70 percent, agriculture at 11.81 percent, food processing at 11.53
percent and the rest is 3.75 percent. This prediction indicates that Malaysia will export more
food products abroad, thus resulting in higher demand for packaging as packaging is part and
parcel of the export business. This will in turn result in the demand for branding, as
manufacturers need to brand their products for export.

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FAMA has also announced that in 2010, the international market will witness an
increase in the percentage of export based on destinations where Asia has been predicted to be
the biggest contributor at almost 50 percent of the international export business (Figure 2).

Figure 2: Contributors of international export business

(Source: Utusan Malaysia, Thursday, June 29th 2006, p.14).

Almost 90 percent of the Malaysian manufacturing of food product capacity comes

from small and medium-sized enterprises (SMEs) and the bulk of them operate in the rural
areas. Malaysian rural businesses such as producing kerepek (chips), kuih bahulu (mini
sponge cakes) and keropok (crackers) are valuable products but are still being produced using
traditional methods in terms of branding or packaging. These products cannot be sold at
international markets because the packaging does not fulfil the international requirements and
regulations.

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Picture-3: AMO%G THE FOOD PRODUCTS OF MALAYSIA% SMEs

(Small Category).

Brand of Biscuits Keropok Lekor

Packaging for Kerepek Cencalok

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4) REVIEW OF LITERATURE

This paper aims to determine the importance of re-branding Malaysia’s SME food products as
an attempt to meet international standards. The final output of this paper is an actual re-
branding process of a food product that incorporated all the necessary and required features to
penetrate the global market. Thus, this review will trace the historical background to the
introduction of brand, branding and re-branding before exploring in detail the contemporary
understanding of the three concepts. This review also provides the elements and types of
branding currently used in the market before as well as the theory and practice of branding.

Re-branding is as much about changing corporate iconography as it is about changing the way
one communicates with the customers (Morgan, 2006). The corporate iconography consists of
creating a new company logo, new stationery, new website or many other things. In similar
line, (Schley and +ichols, 2005) indicated that re-branding is a process of realignment
whereby the company rediscovers the single unifying principle that aligns the organization
with its customers. It means listening to the customers and identifying what is so special
about the product in the eyes of the customers. Sometimes, re-branding has nothing to do with
re-designing visual assets such as logo and tagline and instead focus entirely on operational or
internal mindset changes. The re-branding exercise has become something of a fad in the last
decade, with some companies re-branding several times. For instance, Telekom Malaysia has
gone through the re-branding process three times in order to meet the customer’s need.
Similarly, Radio Television Malaysia (RTM) had gone for re-branding exercises in 2005 in an
attempt to attract more Malaysian TV’s viewers to watch RTM channels rather than the
private TV channels. The latest local corporate institution undergoing re-branding exercise
was Mayban Fortis in November 2007. This re-branding saw five of Mayban Fortis entities
merging into two anchor subsidiaries, namely Etiqa Insurance and Etiqa Takaful (+ew Straits
Times, +ovember 17th, 2007, p. 45).

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4a) SAMPLE OF RE-BRA%DI%G

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5) RECOMME%DATIO%

STRATEGY OF RE-BRA%DI%G A MALAYSIA% SMEs BLUEPRI%T TOWARDS

EXPORT ORIE%TED:

A Malaysian SMEs need to have a long-term creative strategy in order to embark their food
products at global market. This dream cannot be realized within in short time, it may need
two or three years to make this dream comes true. Whatever it is, developing a Malaysian
SMEs blueprint towards export oriented will bring an inherent strength to the Malaysian SME
food products. It also will be an asset that will last a lifetime, generating income and also
growing in value. This strategy also will comprise of re-branding process and with a clear
strategy, objectives, budget involves and timeframes, the Malaysia SMEs could achieve their
target having a strong brand name of their food products towards export market.

5a) Setting-Up The BRA%D Team

The owner of Malaysia SME’s company director, manager or whatever position name they
call, he or she can contribute enormously to the creative process, successful company owner
has vision, direction and realize the importance of creative professionals to their mission on
brand naming activity. Anyway, the owner of Malaysian SMEs Company cannot work alone
to achieve their mission, they need helping hand from other party. Here, the researcher would
like to suggest that they owner of Malaysian SMEs must be setting up one team called The
Brand Team. This Brand Team of course lead by the owner of Malaysian SMEs entrepreneur
assist by Ministry of Entrepreneur Cooperative Development (MeCD) together with local
Advertising Agency (specialized naming consultancies and packaging) which appointed by
MeCD to assist the Malaysian SMEs entrepreneur. The appointed advertising agency is
responsible to come up or create idea on how to develop for brand naming process. This
agency also needs to have a creative person whether art director, copywriter, strategic
marketing expert to be part of this team. In the process of developing the brand name, all the

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party will be taking in giving their ideas and they must have a consistent voice across all
proposals or ideas.

5b) A MALAYSIA% SMES BLUEPRI%T TOWARDS EXPORT ORIE%TED

• Re-branding based on Type of Brand Names

The research would like to forward reccommandations on brand naming
development,

o Focus on brand name distinguish or distinction.

o Ensure relevance, memorable and creative of brand name
o Acceptable at all level of community locally or internationally
o Earn that a new brand name will be standing in the global marketplace and in
the international customers mind.

• Setting-Up the BRAND Team

• Differentiation of the Brand Name;
o Syllables Combinations
o Combining Words
o Alternate Spelling

• Memorable Brand Name

• Descriptive Brand Name
• Identifiers of Food Products
• Creating A Strong Tagline Or Slogan On Food Packaging
• Informative Principal Display Panel (PDP).
• Packaging Effectiveness
• Symbolism and Logo, Trademark and Brand Signature.

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