Are you looking to start a small business in Ethiopia but don’t know where to start?
You don’t have to miss this researched piece of content, where we explore some of the most profitable small business ideas in Ethiopia that you can start with minimal investment.
Ethiopia is a fast-growing economy with a large population and a rapidly expanding middle class.
This presents a unique opportunity for entrepreneurs looking to start a small business.
From food and beverage to retail and service-based businesses, there are numerous profitable small business ideas that you can pursue in Ethiopia.
In this post, we will discuss some of the top small business ideas that are currently thriving in Ethiopia.
Providing you with the information you need to make an informed decision and help you on your journey to becoming a successful entrepreneur.
Small-Scale Business Ideas and Opportunities in Ethiopia
If you’re serious about establishing a business, these are the 28 most rewarding small business opportunities to consider:
1. Open a Daycare and Nursery Center
The role of the childcare provider is a vitally important one that requires an abundance of insight, wisdom, and care.
It involves bringing together competent educators and specialists to watch over children aged between 6 months and 13 years old.
This valuable service has grown exponentially in popularity recently, becoming increasingly competitive due to its rarity.
A great deal of effort should be taken when deciding how best to set up such a business.
An example is A & E Daycare – established by immigrants who have made the United States their home for most of their lives.
Boasting a host of dedicated caregivers and teachers alongside a modern playground, this daycare operates from 7 am to 5 pm each weekday with prices set at 3000 Birr per month or 32,000 Birr per year for single-child admission.
2. Open a Restaurant
For decades, the restaurant industry has been a lucrative source of wealth creation in Ethiopia.
Those wishing to capitalize on this trend may take advantage of the opportunity to begin their own restaurant business right now.
With an ever-expanding population and global demand for food, restaurants provide an ideal platform with which to launch an enterprise that is both profitable and resilient against economic downturns.
This makes it one of the most appealing and viable investments in Ethiopia as well as many other countries around the world.
3. Start a Business Consultancy Services
The Consultancy Services industry in Ethiopia is a booming sector with the potential to provide game-changing solutions to challenges faced by businesses of all sizes.
It covers an extensive range of services, such as strategic consulting, management consulting, technological consulting, human resource consulting, marketing consulting, tax consultancy and finance advisory services.
With a diverse array of offerings available and increasing demand due to the growth in both local and international businesses operating in Ethiopia, there has never been more opportunity for Ethiopian consultants.
Becoming a successful consultant requires strong interpersonal skills; knowledge of technology implementation; sound problem-solving abilities; strategy formulation capabilities and experience in optimizing operational processes within varying business environments.
4. Start an Agricultural and Food Processing Business
Starting an agricultural and food processing business in Ethiopia is a substantial investment that has the potential to reap significant rewards, due to the nation’s heavy reliance on agriculture.
As one of Africa’s oldest countries, this ancient land produces a vast array of crops, from grains and fibre crops such as sesame and cotton, to flowers for export, as well as tea and coffee plantations.
Ethiopia is home to large areas of forest and thriving fisheries providing yet more opportunities for profits.
The commercial processing of both raw materials and agricultural produce adds even greater potential for success in venture into the agricultural sector in Ethiopia.
5. Start Event Planning and Management Business
As Ethiopia’s economy continues to grow and develop, the need for event management services increases exponentially.
Event managers are tasked with diligently overseeing each component of an occasion, whether it be a corporate gathering or social celebration; this includes picking out the perfect venue, crafting an appropriate guest list, and ensuring the decorations and catering services meet expectations.
Establishing yourself as a reputable event manager requires initially investing time into completing jobs to a high standard- which can then lead to numerous clients returning your way in the future.
6. Start a Brick Making Business
The thriving construction industry in Ethiopia offers one of the best and most profitable small business ideas available.
With a relatively low start-up cost, entrepreneurs can invest in automated brick production machines and take advantage of the surge in demand for building materials.
An automated brick machine costs around 29,180 ETB or $1,080 USD and with access to land, water, and labour this could prove to be an invaluable asset.
The vast potential offered by such an enterprise is amplified by government plans to facilitate infrastructure development within the country paving the way for greater investment opportunities into residential housing developments as well as government buildings across Ethiopia.
7. Make an Investment in The Music Industry
Starting a career in the music business can be one of the best small business ideas in Ethiopia.
Establishing an event promotion company or producing quality music videos are both fantastic ways to enter this profitable industry.
Promoters and artists may benefit from sizable investments if they allocate funds correctly, as was demonstrated through a recent 3.4 million Birr deal which resulted in returns ranging between 2-5 times larger than the initial investment.
Similarly, producing promising music video content has grown significantly more expensive due to inflation, with costs rising from 60,000 Birr to 150,000 Birr per video.
8. Open a Football Watching Center
If you’re interested in leveraging your passion for football and making money, one of the best small business ideas in Ethiopia is to open a football-watching centre.
The societal enthusiasm around the sport creates an ideal opportunity for entrepreneurs looking to capitalize on its devoted fan base.
All you’ll need is a comfortable space with televisions where supporters can gather together to cheer on their favourite teams.
It’s an easy way to make money from the enjoyment of others, as well as yours.
With good management and setup, your viewing centre could be a profitable venture in no time at all!
9. Start a Real Estate Business
As Ethiopia’s economy continues to rapidly develop, so does its real estate industry. This presents a great opportunity for entrepreneurs looking to invest in an area of growth and profitable returns.
For the best small business idea in Ethiopia, consider developing a real estate business that caters to both foreign investors and local clients.
Working as a contractor could be the ideal option, allowing you to build properties from scratch and make a steady income from construction jobs.
Alternatively, you could acquire flats or apartments and transform them into attractive rentals.
10. Open a Barbershop
Opening a barbershop in Ethiopia can be an extremely profitable venture. Not only does the country boast a population of 120.3 million people, but with increasing, wealth and changing lifestyles come higher levels of demand for quality haircuts.
With an ever-growing desire for personal grooming among the citizens, running a barbershop would be one of the best small business ideas to set up in Ethiopia.
Furthermore, with easy access to low-cost materials and experienced hair stylists available throughout the region, establishing and managing a successful barbershop could prove very lucrative indeed.
11. Open an Entertainment Lounge
Opening an entertainment lounge in Ethiopia could be a great way to make money and provide stress relief to those living and working throughout the country.
With a large population of ex-pats, locals, and tourists alike, there is a need for somewhere these people can escape to after long days of work or during their leisurely free time.
Whether it be via a bar, nightclub, casino, restaurant or movie theatre; offering thrilling activities and experiences as part of an entertainment package could result in excellent profits.
Furthermore with so many options available to choose from one has the freedom to create something truly memorable that stands out from all other offerings in the area.
12. Start Providing Laundry Services
Starting a laundry service in Ethiopia is an extremely profitable business opportunity. The high demand for efficient, reliable, and cost-effective services throughout the country makes it an ideal choice for small businesses looking to turn a profit quickly.
In order to set up shop, you’ll need access to some commercial-grade washers and dryers as well as a dedicated space in which to conduct your operations – either at home if you have sufficient room or by renting a location elsewhere.
To further attract customers, consider hanging posters and banners around the neighbourhood coupled with detailed brochures outlining your services and rates.
13. Solar Panel Sales and Installation Service
The Ethiopian energy landscape is rapidly changing, providing a unique opportunity and the ideal environment to set up a successful business selling solar panels and providing installation services.
An enterprising individual or organization can take advantage of this trend and capitalize on it by importing quality solar panels that meet high standards established by the Ministry of Environment, Forestry, and Climate Change (MoWIE), the Ethiopia Standards Agency, and the Ethiopian Ministry of Water, Irrigation, and Electricity.
With incentives from the US government for African countries such as Ethiopia, these businesses can benefit from significantly reduced prices on products imported from China.
14. Open a Computer Repair and Maintenance Shop
Starting a computer repair and maintenance business in Ethiopia can be a highly profitable venture. In recent years, more and more Ethiopian citizens have begun utilizing personal computers, resulting in an increased demand for repair services across the country.
By offering hardware repairs such as fixing components or restoring systems impacted by viruses, technicians could realistically earn between 100 to 800 Birr per job – providing ongoing financial opportunities for those interested in tapping into this booming field.
As computer parts and hardware items can be imported from other countries at reduced costs, entrepreneurs may find that establishing their own computer maintenance businesses comes with numerous advantages and cost-saving benefits.
15. Open a Grocery Store
Opening a grocery shop in Ethiopia is an excellent business opportunity due to its high potential for success and profitability.
This small business idea entails stocking up on all types of essential household goods and items, ranging from food and drinks to personal hygiene products.
Instead of buying individual products at market prices, the store can buy them in bulk from wholesale suppliers at discounted rates before selling them to customers at retail prices – thereby ensuring a return on investment on the goods purchased.
Unlike supermarkets that require much higher upfront investments because they cater to a wider customer base with a broader range of product choices, starting a supply shop requires comparatively smaller capital outlay as it only has one specific type of target audience – households.
16. Start Refills for Ball Point Pens
Starting a business to supply refills for ballpoint pens in Ethiopia is one of the best small business ideas and can be highly profitable.
With around 3.7 million students enrolled in just the Amhara Region, there is an abundant market opportunity for entrepreneurs who are looking to open a company that specializes in supplying refills for ballpoint pens.
In fact, estimates suggest that each student uses about 10 pens with accompanying refills over the course of their academic year – equaling out to around 37 million annual consumption of these supplies across all of Ethiopia.
With this large demand and relatively few suppliers, starting up this type of venture can yield considerable profits.
17. Start a Catering Service
Starting a catering business in Ethiopia is an excellent opportunity for entrepreneurs looking to capitalize on the constantly growing demand for delicious cuisine.
As traditional events and gatherings become more sophisticated and require greater attention, people are increasingly unable to provide the quality of food that they desire.
By launching a catering service, you will be able to capitalise on this need by providing delectable dishes that satisfy even the pickiest of taste buds.
You will also have the flexibility of choosing which occasions to cater to, such as weddings or corporate functions, giving you plenty of freedom while still being successful in your venture.
18. Start a Soap Manufacturing Business
Have you been searching for the best small business idea in Ethiopia that can prove to be both lucrative and rewarding?
If so, soap manufacturing could be the perfect fit.
As more and more people recognize the power of natural cleaning products, this time-honoured industry is primed for success.
Soap production involves blending chemical compounds mixed with essential oils or fragrances to create cleansing agents which are either in liquid or solid form.
19. Open a Beauty Salon
A beauty salon is a profitable business idea in Ethiopia, particularly in areas where beauty services are in high demand.
To give your salon the best chance of success, you should select an appropriate location and appoint experienced beauticians to work at the salon.
You should also consider providing organic and herbal products that your customers may be looking for.
It’s advisable to create a welcoming atmosphere so customers feel comfortable when visiting; if you can provide both male and female services, you’ll have even more potential for increasing earnings from the venture.
20. Launch a Cleaning Service Business
Cleaning Services, or Janitorial Contracting Services are becoming one of the most profitable and popular business ideas in Ethiopia.
This is mainly due to the nation’s booming economy, particularly within Addis Ababa which has become a hub for multinational corporations and non-governmental organizations.
In 2014 there were only 48 licensed cleaning service firms, resulting in a wide gap between supply and demand of janitorial services – including furniture, wall and floor cleaning which remain relatively uncommon practices in Ethiopia.
As such these services can guarantee entrepreneurs an extremely lucrative venture with minimal overhead costs since it provides easy access to human resources comparatively cheaper than other nations.
21. Open a Bakery Store
For those looking to break into the food industry in Ethiopia, starting a bakery is one of the best small business ideas.
Established bakeries such as Enrico Pastry and Mulmul Bakery have seen profitable success due to their wide range of offerings.
From cakes and pastries to bread and other baked goods, these businesses serve thousands of customers each day.
Caravan Cake and Shoa Bakery are examples that showcase how successful this type of enterprise can be.
Regardless of size or budget, setting up a bakery offers a highly profitable business idea with the potential for immense growth in Ethiopia.
22. Start a Hotel Business
Investing in the hotel business in Ethiopia can be profitable if done right. There is a high demand for quality accommodation, and you could make a good return by offering much-needed services to people.
To set up a successful business, you need to consider all vital aspects such as location, size of the facility, cost – both of construction and running – and availability of staff.
An ideal start would be setting up a small hotel or motel with approximately 20 rooms in an area that has good foot traffic and easy access to transportation systems.
It would also help if there are other amenities nearby such as restaurants, shops, hospitals, and banks.
23. Make Egg Trays Out of Waste Paper
The best small business idea in Ethiopia may be to produce egg trays from waste paper. Utilizing recycled paper, entrepreneurs could create sturdy, attractive egg trays that protect eggs while being transported.
This will help preserve food safety standards and allow rural families to properly store and transport their eggs with minimal cost.
In addition, it would also be beneficial for city households and restaurants who can utilize the trays as an excellent way of presenting their eggs at the market or on restaurant tables.
With a virtually endless supply of raw materials readily available and no shortage of customers in both urban and rural areas, this profitable business idea in Ethiopia could provide a reliable source of income for budding entrepreneurs across the country.
24. Open a Car Wash
For entrepreneurs looking to make a name for themselves in Ethiopia, starting a car wash business is one of the best and most profitable small business ideas.
This type of venture doesn’t require substantial capital as it only requires an open area and necessary supplies such as brushes, sponges and soaps.
To offer your services professionally, having hired hands can be beneficial in order to meeting customer demand at all times.
Offering consistent quality is key to establishing and maintaining client loyalty – something which can lead to great financial rewards over time.
25. Open a Driving School
For entrepreneurs looking to start a business in Ethiopia, launching a driving school could be one of the most profitable opportunities.
With an increasing number of people eager to learn how to drive and get their license, it would make for an ideal small business venture.
Of course, this type of enterprise requires that you choose skilled trainers who can effectively teach students while also observing all relevant regulations.
Once these permits and licenses are granted by the government, you should be good to go!
26. Open a Mobile Phone Repair Shop
With the ever-growing use of mobile phones in Ethiopia, owning a mobile phone repair shop can be an incredibly lucrative and rewarding business venture.
Investing in such an enterprise could deliver high returns and create a successful career path.
The market potential reaches vast numbers – with estimates suggesting that Ethiopians spent over 1 billion pounds within the last three years on repairing their damaged devices alone.
Coupled with the fact that almost one-fifth of individuals cracked their screens by dropping them, yet only roughly 56 per cent actually protected their device with a hard case, opens up even more opportunities for entrepreneurs to step into this unmet demand and fill it with quality service delivery.
27. Internet and Cyber Café Business
For entrepreneurs, starting an Internet and Cyber Café Business in Ethiopia can be a profitable venture.
With the ever-increasing need for internet access across African countries, you can set up your own café business with a reasonable initial capital investment.
First, you’ll need to purchase several desktop computers with great hardware specifications that guarantee heightened performance levels.
Then you’ll have to install robust antivirus software on them since many of your customers might unknowingly download malicious content from certain websites or e-mails.
Set competitive internet rates and ensure it’s easy for customers to connect their devices to your cafe’s WiFi network.
28. Start a Garbage Collection and Waste Management
The problem of waste in Ethiopia is an urgent one, and there are few to no efficient solutions.
Starting a garbage collection and waste management business is a viable avenue to capitalize on this crisis while providing much-needed assistance.
You could provide households with regular trash collection services at reasonable rates while assuring that the waste is disposed of properly and safely.
This may then be coupled with educational initiatives, aimed at instilling proper recycling habits among local communities.
Earning potential for such a venture would depend on the scale of operation — whether it’s restricted to residential areas or more expansive across commercial establishments as well as institutions like schools and hospitals.