Purpose This study aims to identify and examine the growth constraints of the halal cosmetics ecosystem in which SMEs are operating in, with special focus on the situation in Malaysia. Design/methodology/approach The study adopted a qualitative methodology consisting of a systematic literature review and interviews with selected consumers and policymakers. The instruments were developed based on cybernetics and a systems-based approach, which allows for the understanding of the dynamics of growth variables in the halal cosmetics ecosystem. Based on data gathered, their relationships were mapped and major growth constraints were identified. Findings Cybernetics and systems approach coupled with growth diagnostics framework has enabled identification of comprehensive growth constraint variables for halal cosmetics ecosystem and mapping of growth constraints (variables) in a relationships network. The study found that the enforcement activities of the National Pharmaceutical Research Agency (Cosmetics Unit) directly affect five growth constraints and is associated with three other growth constraint variables; subsequently the most binding growth constraint. The relationship network derived from the mapping of the growth constraints indicated that changes in the behaviour of any element will affect the overall operations of the ecosystem. Research limitations/implications While the cosmetics industry is large and varied, this study is centred on halal colour cosmetics only. The growth constraint variables studied are those chosen by researchers and other growth constraints could be studied to guide policymakers. Future research can revolve around other halal cosmetics business sectors; impact of IR4.0 technology, COVID-19 pandemic impact; crisis and risk management issues, in the halal cosmetics industry. Practical implications The results derived from the cybernetics analysis affirms the “outside-in” marketing perspective, thus stakeholders should continuously monitor changes in the halal cosmetics ecosystem to ensure to ensure sustainability and profitability. Small and medium enterprises (SMEs) and policymakers can initiate pre-emptive actions by conducting simulations of various situations on the halal ecosystem. Social implications Enabled to simulate the effect of changes to the halal cosmetics ecosystem, stakeholders are able to take intervention initiatives, safeguard accessibility to halal cosmetics and make the halal cosmetics industry sustainable. Originality/value To the best of the authors’ knowledge, this is the first comprehensive research to identify the growth constraints of the halal cosmetics industry in Malaysia that focusses on three groups of stakeholders (consumers, SMEs and government institutions) concurrently. The growth constraints relationship network of the halal cosmetics ecosystem can be further used to simulate the impact of changes within the system.

To improve the incomes of a population and attain sustainable development, a nation’s primary goal must focus on continuous and inclusive economic development. Such optimal conditions will create economic security with greater and better employment opportunities for her citizens. This study seeks to look at the halal cosmetics sector, which is fast expanding globally, with special focus on the situation in Malaysia. Subsequently, it is crucial to diagnose the factors affecting the growth of halal cosmetics SMEs operating in the halal cosmetics ecosystem. A cybernetics and systems-based approach will be developed to understand the dynamic nature of growth variables and their relationships will be mapped based on data gathered from various groups of stakeholders in Malaysia. The research method chosen is qualitative due to the multi-faceted nature of the halal cosmetics industry. The cybernetics analysis had identified the most binding constraint variable within the halal cosmetics industry. This will enable policy makers and SMEs to take intervention initiatives and thereby ensure the growth of halal cosmetics industry and increase inclusive growth in this industry. It has also paved the way for the stakeholders to predict behavioural changes of the affected variables should any of the related growth constraint variable alter. Advent of COVID19 pandemic has impacted the cosmetics industry as a whole and use of augmented reality coupled with the rise of skin care gadgets has ensured survival of this industry.