In general, Malaysia is still a very price-driven market. Premium and high end quality products are predominantly catering to niche markets.

Nevertheless, according to Synovate’s Media Atlas survey done in June 2007, more than half (55 percent) of young Malaysians aged 25-34 seek quality above any other consideration when purchasing goods and they do not mind paying extra for it. 

A quarter of Malaysians in the middle and higher income groups living in urban market centres said they would prefer to buy designer goods and well-known brands.  More men than women are likely to be influenced by designer goods and well-known brands.

The degree of brand loyalty in Malaysia varies depending on the product category. In the case of food and skin care, as well as cosmetic products, consumers tend to switch brands whenever there is a promotion. 

Malaysia is a multi-racial country with different religions. Thus, New Zealand exporters should be culturally sensitive on the type of language used and the graphics on the packaging. For example, pigs and dogs are not favourable for Muslims, the cow is a symbolic animal for Indians while black is basically not an auspicious colour for Chinese.

Get general advice on Export marketing in the Export guide.

According to the Synovate survey, 48 percent of Malaysian consumers between the ages of 15-24 prefer to be informed about products through ads in print (newspaper and magazines) while in the 20-49 age range, 35 percent of Malaysians actually held greater trust in products advertised.

Only 21 percent of Malaysians surveyed viewed the internet as a tool to get unbiased opinions on products.

Goods used for exhibition, advertising, commercial samples and professional equipment can be brought into Malaysia using the ATA Carnet facilities. Goods must not be for sale and must be re-exported within a specific period approved for their admission.

Items excluded from the ATA Carnet System include items already sold or offered for sale, theatrical make up, alcoholic beverages, tobacco and fuels and goods intended for processing or repair. ATA Carnet applications should be made to the Malaysia International Chamber of Commerce and Industry (MICCI).

Get general advice on attending trade events and promotions in the Export guide.

There is no specific law or regulations relating to the use of agents in Malaysia.

Exporters should consider looking for agents located in Kuala Lumpur, Malaysia’s largest and most affluent city (greater population approximately 7.2 million). Other major towns include Penang, Ipoh and Johor Bahru in Peninsular Malaysia, Kota Kinabalu (Sabah) and Kuching (Sarawak).

Most Malaysian agents want exclusivity from importers, especially on value added products of renowned brands. One reason is the financial commitment they often have to make in marketing, promoting and distributing the product or service.

Exporters wanting to participate in government tenders are advised to work with a Bumiputra (of Malay ethnic group) partner, as Bumiputra businesses are sometimes given preferential treatment in government projects.

There is no specific law or regulations relating to the use of distributors in Malaysia.

Exporters should consider looking for distributors located in Kuala Lumpur, Malaysia’s largest and most affluent city (greater population approximately 7.2 million). Other major towns include Penang, Ipoh and Johor Bahru in Peninsular Malaysia as well as Kota Kinabalu (Sabah) and Kuching (Sarawak).

Most Malaysian distributors would want exclusivity from importers, especially on value added products of renowned brands. One reason is the financial commitment they often have to make in marketing, promoting and distributing the product or service.

Exporters wanting to participate in government tenders are advised to work with a Bumiputra (of Malay ethnic group) partner, as Bumiputra businesses are sometimes given preferential treatment in government projects.

Get general advice on using agents and distributors in the Export guide.

New Zealand exporters are advised to provide quotes in New Zealand dollars to avoid currency fluctuations. Quotes in New Zealand dollars are acceptable to Malaysian businesses.

Only a handful of retailers and hotels in Malaysia import directly from overseas suppliers and this tends to be limited to certain food and beverage products. Due to the small market size for high end premium food and beverage products, these retailers and hotels generally directly import the goods in consolidation basis.

E-commence is developing in Malaysia, but is still in its infancy, with the internet penetration rate recorded at 61 percent by the Malaysian Communications and Multimedia Commission. Authorities estimate that Malaysia had 15.9 million internet users at the end of 2008, up from 14.9 million a year earlier.

E-commerce activity is affected by a lack of confidence about online purchasing, slow broadband access and immature online payment systems.  Internet access is basically limited to urban areas and online shoppers are mainly the educated and IT savvy.

The March 2009 stimulus package allocated M$3 billion to improve broadband infrastructure, and M$2.4 billion to establish broadband links for community centres and provide basic telephony services in rural areas.

Get general advice on direct and indirect exporting in the Export guide.

There are four schedules in the Malaysian Trade Classification and Customs Duties Order book listing a range of items under varying levels of restrictions.

List 1: Includes prohibited items, i.e. all imports from Israel and products banned for religious, moral, security and environmental reasons.

List 2: Products under this list require licences - the list includes poultry, meat, eggs, rice, sugar, clinkers, wood, safety helmets and telecommunications equipment.

List 3: Products under this list require a licence to afford temporary protection to local manufacturers. Products covered include milk, cabbage, coffee, cereal flours, some iron and steel products and certain wires and cable.

List 4: Products within this list can only be imported after meeting specific criteria. The list covers animals, animal products, plants, plant products, cigarettes, soils, and fertilisers of animal origin and electrical accessories.

While all dairy products require import licences, this requirement does not form a significant barrier to market entry. Import permits are issued by the Department of Veterinary Services.

All shipments must be accompanied by a health certificate signed by a government veterinary authority from the country of origin. The certificate should state that the supplying country was free from foot-and-mouth disease and rinderpest for 12 months prior to and up till the export of the product to Malaysia.

Every consignment of cheese imported into Malaysia must be accompanied by a Health Certificate and a Certificate of Analysis for bacterial parameter Listeria Monocytogenes issued by a competent authority of the exporting country and done by an accredited laboratory.

All edible meat imports including offal are subject to government control. An import permit is required from the Department of Veterinary Services.

In addition to health certification, all meat offal and meat products derived from cattle, buffalos, sheep, goats, poultry, and deer must be halal processed at a Malaysian approved registered export establishment. A halal certificate issued by an Islamic organisation recognised by the Malaysian Government must accompany the meat.

Only direct shipments of meat products to Malaysia from the country of origin or transhipment through bills of lading via Singapore will be approved. Re-exports into Peninsula Malaysia and East Malaysia via Singapore will not be accepted.

There are no import duties or sales taxes imposed on meat imports entering Malaysia. 

At present there are no quarantine restrictions imposed by the Malaysian Government on imported fresh fruit. All fresh fruit consignments entering Malaysia are subject to inspection at the port of entry and if necessary, treatment by the Department of Agriculture prior to clearance by Malaysian Customs.

Import duties are levied on CIF (Cost Insurance Freight) values, while sales tax is based on the aggregated value (i.e. CIF plus import duty). There are no import duties on almost all of the fresh vegetables imported into Malaysia. The only items subject to import licensing are round cabbages.

Some processed foods face import restrictions. An Import Licence from the Veterinary Department and an Import Permit issued by the Director General of Veterinary Services are required to import products containing poultry and meat. Importers of cereal flours (wheat or meslin) also require an Import Licence.

There are no import restrictions imposed on seafood. However, all shipments are subject to inspection by the Ministry of Health at the port of entry and local importers are required to apply for an Import Licence (renewable annually), from the Fisheries Development Authority of Malaysia. A letter of approval is required from the Department of Fisheries Malaysia for live fish imports.  Furthermore, all shipments of imported fish and seafood must be certified free of nitrofuran, chloramphenical and beta agonist.

There are generally no import quotas or restrictions imposed on wine and brandy. All liquor shipments entering are subject to Customs clearance and duties. It is normal for Customs to take one bottle from each case to assess the alcohol content thereby affecting landed prices.

Local importers must obtain a wholesale license from Customs.

Tariffs and duties

The Malaysian customs tariff nomenclature is based on the Harmonised System (HS). The Government is progressively implementing a tariff reduction programme in line with its undertakings to the World Trade Organisation (WTO). Look up current and phased tariff rates for the agreement establishing the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) signed in February 2009. Use the tariff finder. New Zealand Trade and Enterprise (NZTE) can provide free, basic information on tariffs at an indicative level to assist companies assess viability of market entry.

Useful information and contacts

Royal Malaysian Customs
Malaysia International Chamber of Commerce and Industry

Packaging and labelling

As more than half the Malaysian population is Muslim, labelling requirements for products containing pork and alcohol are very strict. Labelling requirements specify that food items may be labelled in either Malay or English and must contain the following information:

• a description of the product.
• a list of ingredients, in descending order of proportion by weight.
• a statement as to the presence  of any animal products (e.g. meat, gelatins).
• if the product contains any alcohol, a statement indicating this.
• the minimum net weight of the product.
• the name and address of the manufacturer.
• the name and address of the importer (which can be added at the time of import).
• a statement of shelf life or expiry dates. (USDA).

It is a good idea, although not compulsory, to include Malay language wording on product labels. A high percentage of the population speak English but if your product is targeted at the Malays (60 percent of the population), then it is sensible to provide both languages.

New Zealand exporters of pharmaceutical drugs, cosmetics, certain health care items, food supplements and tonics would usually need to have their products assessed by the the National Pharmaceutical Control Bureau (NPCB) before being able to enter the market. The NPCB ensures the quality, efficacy, and safety of pharmaceuticals through the registration and licensing scheme. According to how the product is classified, the exporter may have to meet certain labelling and ingredient requirements.

For general advice on sales and marketing in offshore markets go to the Export guide.

Topics covered include:

- How to set prices.
- How to identify your target market.
- How to check out the competition.
- How to create and market brands.
- How to advertise and use media.
- Attending trade events and promotions.
- How to use agents  and distributors.
- Direct and indirect exporting.