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Top 27 Small Business Ideas in Kerala for 2024 With Low Investment

Kerala is known as “God’s Own Country” and boasts scenic beauty and cultural richness. It is also a fertile ground for innovative entrepreneurs. Here in this article, we have listed the top-notch business ideas that promise fulfillment and financial success.

Kerala is an investor-friendly, 100% literate, and 100% digital state. Compared to other competitive locations, the state offers low operating costs for start-ups in the state. Low rentals, power, water, and transport tariffs keep operating costs minimal for industrial units located in the state.

Kerala permits up to 100% direct foreign ownership, subject to certain conditions. Small, medium and large-scale business initiative procedures have been thoroughly streamlined. Whether you are a resident here or from outside and want to start a business in Kerala, this article will help you find legitimate investment opportunities in Kerala.

List of 27 Business Ideas in Kerala

#1. Automobile Service Station

Increasing demand for commercial vehicles has created the largest construction of automobile showrooms in Kerala. Some of these showrooms are the largest in Asia. Apart from vehicle showrooms, there is also a growing demand for tires and auto parts stores in Kerala.

The boom in luxury car sales in Kerala started in 2012-13. Today, the state accounts for 13% of the national sales of premium cars. Thus, starting an automobile service station is one of the most profitable small business ideas in Kerala for new entrepreneurs.

#2. Ayurveda Tourism

Ayurveda is a therapy that promises holistic wellness. The experts use natural herbs and oils in the therapy. These oils have great medicinal value according to the Vedic literature on Ayurveda. There is a strong potential for the growth of Ayurveda tourism in Kerala.

It can easily be called the only place that has an unbroken tradition of Ayurveda. A year-round pleasant climate, a moderate temperature hovering between 24 to 28 degrees, ample rainfall ensured by two monsoons, humid air, and abundant natural wealth are some of the factors that provide the perfect natural setting for Ayurveda’s healing touch as does Kerala.

#3. Start a Home-Based Online Business

At present, anyone can make money online from the comfort of home. This is true for the people of Kerala too. Some of the legitimate ways are listed below:

#4. Agarbatti Making

Kerala can be an ideal place to make Agarbatti sticks as the raw materials are easily available nearby. This is one product in India that has a demand around the year as almost all households use Agarbatti for aroma and religious reasons.

#5. Start a Small Manufacturing Business in Kerala

Though the start-up cost of starting a manufacturing business is a little higher than retail businesses, however, the high-profit returns ensure a fast payback of the investment. There are several manufacturing business opportunities one can start in Kerala with low investment.

#6. Open a Grocery Store

If you have a retail space in a good location, you can start a grocery store in Kerala with little investment. Selecting a proper location though is critical to the success of this business.

#7. Open a Fast Food Restaurant

Fast food restaurant is another lucrative business in Kerala. More and more people in the state are showing interest in having fast food in recent days.

#8. Boutique Business

Kerala is a destination for tourists. The location enjoys not only domestic but also international visitors. So, the location is one of the best places to start a boutique business with unique and innovative collections. Apart from designer clothes, you can consider keeping a whole range of products in the apparel segment.

#9. Start a Hotel

As Kerala is a good tourist destination, boutique hotel is a naturally lucrative business here. Tourists prefer to taste the local culture, food items, and some different touches at the time of their stay. Initiating a boutique hotel business requires moderate cash investment. And if you don’t open other hotels in the expansion, then it is a one-time investment business.

#10. Certified Seed Production

Rice is the most important food crop in Kerala. It occupies 7.46% of the total cropped area of the state. However, the area under rice has been falling at an alarming rate ever since the 1980s. Hence, starting a certified seed production unit is a highly lucrative business here to supply paddy seeds to the farmers. Broadly, seed production requires improved cultural practices and efficient weed, disease, and pest control.

#11. Coconut-Based Food Processing Unit

Kerala is one of the major coconut-producing states in India. Coconut provides the principal source of income – from the coir industry to coconut shell artifacts. And you can produce plenty of processed foods from coconut. Hence, starting a coconut-based food processing industry is highly lucrative here.

#12. Fertilizer Distribution

There are more than 247 industries that are manufacturing a range of products like chemical fertilizers, pesticides, zinc/chromium compounds, etc. And definitely, these companies look for efficient distributors for distributing their products. Starting a fertilizer distribution business requires moderate capital investment and a license from the state fertilizer authority.

#13. Hookah Bar Lounge

As Kerala is a prominent tourist destination in India hookah bar lounge business is a very good retail investment option here. Kerala is also famous for pulling foreign tourists throughout the year. Hookah bars and lounges are some of the lucrative small business ideas in Kerala to start for young entrepreneurs.

#14. Jewelry Making

Gold and diamond are the lucrative fields of business in Kerala. Apart from that pearl jewelry and fashion jewelry are also in high demand.  There is a huge potential for a jewelry business in the state. The diamond segment is aggressively growing among youngsters. Any individual can initiate a jewelry-making business in Kerala with low capital investment.

#15. Microbrewery

Every year, liquor and beer sales are growing. Rum and brandy are the preferred drinks in Kerala in a country where whiskey outsells every other liquor. Hence, opening a microbrewery is a lucrative business idea in Kerala. If you want to start a food retail business, then this is probably the best opportunity for new entrepreneurs.

#16. Mobile Facial Spa

Mobile facial and spa services can be initiated here as a profitable investment opportunity. You start this business either as a retail storefront or from your home.

#17. Photography

As the state is a prominent tourist spot and recognized for its scenic beauty, photography is one of the most profitable small business ideas here to start with very little investment. This can be treated as a wonderful self-employed opportunity or as an organized professional photography company.

#18. Recruitment Agency

As more and more companies expand their businesses in the state, one can consider starting a recruitment agency business as a profitable venture in Kerala. The recruitment agency business is vast by nature. You can offer several services like permanent staffing, temporary staffing, RPO, payroll solutions, employee training, etc.

#19. Retail Business

Kerala is a state just perfect for retail business. Apart from its population, the state enjoys a huge number of tourists every year. And certainly, it results in a wide chance of impulse buying activity. Therefore, starting a retail outlet that sells both utility and innovative luxury items is a profitable business in this state.

#20. Rice Milling

The key agricultural staple food in Kerala is rice. With some six hundred varieties grown in Kerala’s extensive paddy fields. Therefore, it opens up a lucrative opportunity to initiate a rice mill business in Kerala. Depending on the production output you want, you must procure the machinery. Also, you can apply for Govt. a subsidy in establishing a rice mill here.

#21. Security Related Business

Security-related business nowadays is in high demand. Any type of security-related business like a private investigation agency, cybersecurity expert, etc. is a profitable small business opportunity in Kerala.

#22. Spice Business

Kerala is also a major producer of spices that form the cash crops of the state. The important spices are cardamom, cinnamon, clove, turmeric, nutmeg, and vanilla. Hence, spice needs grading, grinding, and packaging for human consumption. So, you can start a spice business here. If you don’t want to go to the manufacturing activity, then you can consider trading or distribution or even opening a retail store.

#23. Tea Bag Making

Kerala is also a major tea-producing state. After coconut, tea is a significant cash crop here. If you want to start a small manufacturing business, then you can consider opening a tea bag-making business here. Depending on your skill and investment capacity, prepare the proper business model. Simply you can distribute the products to local retailers or you can only go for online selling.

#24. Tour Guide

The tour guide is one of the most incredible small business ideas here to start with almost zero investment. National Geographic Traveller has selected Kerala as one of the 50 destinations of a lifetime and one of the 13 paradises in the world. Of course, you can start this business with an organized company formation with moderate capital investment.

#25. Travel Agency

Currently, the State has recorded an average annual growth of 25% in foreign tourist arrivals. With the emergence of the state as the most preferred holiday destination for domestic and international tourists, the demand for world-class accommodation too is on the rise.  A full-scale travel agency business with other allied services is one of the most profitable small business ideas here for startup entrepreneurs.

26. Start a Spice Business

Given Kerala’s status as the Spice Capital of India, entering the spice trade is a lucrative venture. You can cultivate and export high-quality spices like cardamom, pepper, and cinnamon, tapping into the global demand for exotic flavors.

27. Organic Farming Ventures

There is a rising global demand for organic produce. Hence, initiating an organic farming venture is a wise choice. You can grow pesticide-free fruits, vegetables, and herbs, meeting the increasing consumer preference for healthy, sustainable options.

How to Start a Business in Kerala

if you want to start a legally compliant successful business in Kerala, there are certain steps that you must follow. Here are some basic steps:

  • Select a Business Idea
  • Do Market Research
  • Name your Business
  • Register your Business
  • Get Required Licenses and Permits
  • Arrange Funds
  • Hire Manpower
  • Have a Marketing Plan

Frequently Asked Questions

Is Kerala a good place to start a business?

Yes, the state of Kerala is one of the best places to start a business. There are multiple reasons why Kerala is a business-friendly state. Some of them are low establishment costs, excellent rail-road-air connectivity, cheap labor, skilled and educated working manpower availability, the good purchasing power of the local people, and support from the government departments.

What are the best cities in Kerala to start a business?

The top cities in Kerla for starting a business are as follows:

  • Kochi
  • Thiruvananthapuram
  • Kozhikode
  • Thrissur
  • Kannur
  • Kollam

What makes Kerala a favorable business destination?

Kerala’s unique blend of natural beauty, cultural heritage, and growing economy make it an ideal location for diverse business ventures.

Which Business is Best to Start in Kerala?

Kerala is a coastal state. Hence coconuts are available in plenty and at a cheaper price. Any business related to coconuts has a higher chance of getting successful in the state.