So many online listicles on small business ideas in Malaysia are arbitrarily written – and some are quite clearly copied word-for-word from ChatGPT!
As those seeking small ideas are likely very new to business, weโre annoyed by this.
And so, weโve turned to 2022 – 2023 data from the Department of Statistics to curate a list of 25 small business ideas in Malaysia that:
- Donโt require heavy initial capital expenditure
- Donโt need specific technical expertise
- Have proven demand, and
- Can be easily incorporated as a company
Keep scrolling to see our methodology or click here to skip straight to the list.
Letโs begin!
Focusing on the service sector
After looking at some information, we believe Malaysiaโs service sector is where the average small business will find their best chance of success.
Hereโs how weโve arrived at our list of suggested businesses.
Itโs where Malaysian SMEs thrive
The latest data available on SMEs from Malaysiaโs Department of Statistics (DoSM) reports that there were 1,173,601 businesses in Malaysia that fit the description of Micro, Small, and Medium Enterprises (MSME) in 2022.
Of these, the breakdown of sectors was:
- 84.7% in services
- 7.9% in construction
- 5.6% in manufacturing
- 1.4% in agriculture, and
- 0.4% in mining & quarrying
Yes, a service-based business is generally less capital intensive or technically demanding.
Size of the Malaysian service sector
Even more good news: the service industry as a whole is Malaysiaโs biggest economic sector, accounting for roughly half of Malaysiaโs total GDP according to DoSM.
Additionally, the sector has enjoyed steady year on year growth:
- Q4 2020 RM 448.1 billion
- Q4 2021 RM 495.5 billion
- Q4 2022 RM 560.3 billion
- Q4 2023 RM 594.5 billion
This is highly encouraging as you never want to enter a shrinking market.
Implications for first time small business owners
If we are starting a new business with no experience, itโs wise to follow the crowd.
Why?
Because on average, this is how others in our situation have most likely found success, and in this case, that means the service sector!
Also, the steady growth of the sector strongly suggests there is room for new players.
Top industries within Malaysiaโs service sector
Hereโs a breakdown of the RM 594.5 billion generated by the service sector in Q4 2023, starting from the highest to lowest values.
Sector | Value (in billions) |
Wholesale Trade | 190.0 |
Retail Trade | 185.5 |
Motor Vehicles | 53.8 |
Information Technology and Communications | 43.4 |
Transport and Storage | 39.6 |
Food & Beverage | 18.4 |
Professional Services | 17.9 |
Real Estate | 11.0 |
Administrative Support | 9.6 |
Health | 7.4 |
Education | 5.9 |
Recreation | 5.5 |
Accommodation | 3.9 |
Personal Services | 2.4 |
For a small business idea, you canโt choose a sector based on revenue alone, as some need high capital and technical expertise.
Instead, you want sectors that balance market size with lower capital and technical demands.
Our top five are:
- Retail Trade (RM185.5 billion)
- Food & Beverage (RM18.4 billion)
- Professional Services (RM17.9 billion)
- Real Estate (RM11.0 billion)
- Administrative Support (RM9.6 billion)
And thatโs where our 25 small business ideas will come from!
25 small business ideas in Malaysia
IF youโve skipped straight to this section, just know that these business ideas are exclusively based on top earning and SME-friendly sectors within Malaysiaโs service industry.
We highly encourage you to read our methodology, and hope you find this list useful.
Retail and trade
Q4 2023 revenue: RM185.5 billion
YoY growth: 5.1%
1. Online boutique
An online store specializing in unique clothing and accessories, utilizing platforms like Shopify or Etsy to reach customers.
2. Specialty food store
A shop offering unique and gourmet food items, such as organic products, imported goods, or locally sourced delicacies.
3. Second-hand clothing store
A store selling gently used clothing and accessories, either through a physical location or online, catering to budget-conscious consumers.
4. Home decor shop
A retail outlet featuring home decor items, including furniture, art, and accessories, aimed at customers looking to enhance their living spaces.
5. Pop-up shop
A temporary retail space that allows businesses to test the market and generate buzz without the commitment of a permanent location.
Food & beverage
Q4 2023 revenue: RM18.4 billion
YoY growth: 6.3%
1. Food truck
A mobile kitchen serving a specific type of cuisine or specialty dishes, perfect for festivals, events, and high-traffic areas.
2. Coffee shop
A small cafe offering a variety of coffee drinks, pastries, and light snacks, providing a cozy atmosphere for customers to relax.
3. Catering service
A business providing food and beverage services for events such as weddings, corporate meetings, and parties, tailored to clients’ needs.
4. Bakery
A shop specializing in baked goods like bread, cakes, pastries, and cookies, serving both walk-in customers and custom orders.
5. Juice bar
A small outlet offering freshly made juices, smoothies, and health drinks, catering to health-conscious consumers.
Professional services
Q4 2023 revenue: RM17.9 billion
YoY growth: 9%
1. Freelance writing service
Providing writing services for blogs, websites, marketing materials, and more, tailored to clients’ needs and industries.
2. Graphic design service
Creating visual content for businesses, including logos, branding materials, advertisements, and digital media.
3. Social media management
Managing social media accounts for businesses to enhance their online presence, engage with customers, and increase brand awareness.
4. Personal coaching
Offering guidance and support in areas like career development, personal growth, and health, tailored to individual clients.
5. Accounting and bookkeeping
Providing financial services such as bookkeeping, tax preparation, and financial planning for small businesses and individuals.
Real estate
Q4 2023 revenue: RM11 billion
YoY growth: 10.5%
1. Real estate agency
Assisting clients in buying, selling, and renting properties, providing market insights and negotiating deals.
2. Property management
Managing rental properties on behalf of owners, including tenant relations, maintenance, and rent collection.
3. Vacation rental business
Offering short-term rentals for vacationers, managing properties listed on platforms like Airbnb or VRBO.
4. Home staging service
Preparing homes for sale by arranging furniture and decor to enhance appeal and attract potential buyers.
5. Real estate photography
Providing high-quality photos and videos of properties to help real estate agents and owners market their listings.
Administrative support
Q4 2023 revenue: RM9.6 billion
YoY growth: 9.2%
1. Virtual assistant
Offering remote administrative support, including email management, scheduling, data entry, and customer service.
2. Data entry services
Entering, updating, and maintaining data for businesses, ensuring accuracy and efficiency in records.
3. Office supply business
Selling office supplies and equipment to businesses, schools, and individuals, either through a physical store or online.
4. Mail and packaging service
Providing mailing, shipping, and packaging services to individuals and businesses, including handling of courier services.
5. Event planning and coordination
Organizing and managing events such as conferences, weddings, and corporate meetings, handling all logistical details.
Evaluating a business idea’s potential
Just because we listed it above doesn’t mean you should do it!
If you want to start a business, stop looking for a โbusiness ideaโ and start looking for a problem to solve.
Once you identify a gap, map out aspects of your solution with a business model canvas – we’ve got a simple template anyone can directly edit for free below.
Ideally, your solution should have a unique value proposition that sets it apart.
This means you mustn’t fall in love with ideas – get used to eliminating ones that donโt seem to work.
Here’s what a Business Model Canvas of MISHU’s Fish Business might look like.
And once you find something worthwhile, the next step should be registering a business entity.
From business idea to business entity
Regardless of what business idea you settle on, itโs important to register a business entity for several reasons:
- Itโs a legal requirement by the government and specifically LHDN
- It makes you more trustworthy to potential clients and customers
- It allows you to apply for small business loans and other SME benefits
- It allows you to hire staff legally
- If you go into business with a friend or partner, both of you are protected
As an SME, you have two main options: an Enterprise or a Sdn Bhd.
We generally recommend incorporating a Sdn Bhd as it offers more protection and structure, though bear in mind it comes with higher operating costs and legal requirements.
Here are a few resources you might find handy:
- A complete guide to starting and running a Sdn Bhd
- A definitive guide to Enterprise vs Sdn Bhd
- Answers to top questions on company incorporation
- How to register your own company via MyCoID
Let MISHU help register your first business
MISHUโs team of licensed Company Secretaries and business consultants are here to help entrepreneurs start, build, and grow their businesses. Get in touch โ weโd love to help with yours!
FAQs about starting a small business in Malaysia
- Which business is best to start in Malaysia?
๐กMISHU recommends looking at businesses within the service sector as it is both a growing market and has low barriers to entry. - What business can I start with RM 1,000?
๐กYou could start an online ecommerce store or offer some sort of digital-based professional service to other businesses. - What business can I start with RM 10,000?
๐กA pop-up shop are viable options due to their low initial inventory requirements and the ability to operate without a physical storefront. In the food and beverage industry, a food truck and a juice bar can be started on a small scale with basic equipment and a limited menu. - What business to start in Malaysia in 2024?
๐กWe strongly recommend starting by looking for a problem you are well-equipped to solve and can add value to instead of looking for random business ideas. - What is the most successful small business to start?
๐กThe one you can successfully run and manage ๐ - Which industry is booming in Malaysia?
๐กThe service industry has been steadily growing over the past years and currently contributes to over half of Malaysia’s GDP. - Which is the fastest growing business?
๐กToday, the fastest growing businesses tend to be tech-based, though B2C products and services that have a high chance to go viral can also enjoy explosive growth.