Malaysia is a country in the Southeast Asia region. It is bordered by Singapore, Thailand & Brunei. The country has a land area of 329,613 square kilometres & a total population of 32.6 Million (2019). The country is currently a developing country. But, according to The World Bank, Malaysia is on the fast track to becoming a developed nation by 2020-2024. Malaysia, an upper-middle-income country has a GNI per capita of RM42, 607 (US$ 10,449). It needs to reach the benchmark of US$12,055 to be a ‘developed country’. Malaysia’s’ attractive economy motivates businessmen to invest in the country. The country ranks 15th on the ‘Ease of doing business index’. It is an assurance that it is easy to start a business and sustain it in Malaysia.
You will find that Malaysia is a multi-cultural country. Their races comprise of Malay, Chinese and Indian. Malaysia has an established legal system is based on the legal system of the United Kingdom.
The countries interest rates have been stable throughout the years. Also, its inflation rate in 2019 is low at 1.02%. This shows that the environment to conduct business is favorable. The country has a broad range of trading partners. The largest partners are China, Singapore and the United States of America.
Business opportunities in the country are endless. Yet, based on our research we found businesses in the following areas are most profitable. When starting a business in any country it is good to first get a feel for the country. To live in it, meet locals and see what is in demand. We at S&F consulting will provide you comprehensive exposure to Malaysia. Our dedicated staff will be able to assist you in various matters of your business.
Our research has enabled us to come up with the 7 most profitable businesses in Malaysia.
Travel / Tourism
When tourism is concerned, Malaysia has a strong ranking among other competitive nations in the world. With many races and ethnicities living in harmony, the country is a melting pot of culture and vibrancy. The country has accommodated 27,437,315 tourists in 2018! Tourism is the third-largest source of income in Malaysia. If you have an idea of starting a tourism business in the country, rest assured it will be profitable. However, certain measures need to be undertaken when planning to set up a business related to travel and tourism in Malaysia.
Fashion
We see a boom in the clothing industry in Malaysia. Malaysians have a higher disposable income. They use it to purchase consumer goods. As the country is 61% Muslim, it has created a demand for contemporary, fashionable & modest clothing. The market demand for the industry was a whopping 7 billion US Dollars in 2018. It is a business worth investing in.
Foods & Beverages
Malaysia’s diversified culture plays an influence on its mouth-watering cuisine. Food brings families together. So needless to say, food and beverage companies are lucrative profit-making businesses in any country. As tourism skyrockets in Malaysia, you will not only cater to the locals but also the international customers as well.
Microfinance Services
Microfinance is a type of banking service provided to low income or unemployed individuals. There are several small businesses that lack funds. If you have sufficient capital & banking knowledge, you can start a microfinance institute in Malaysia. You can make good earning even from the comfort of your home.
Local Cab service
With the growth of tourism in Malaysia, there is a demand for professional cab services. Many tourists prefer sight-seeing in cabs. It saves them the hassle of having to rent a vehicle or find directions. If you have a vehicle, you may need to register it & you are ready to go.
Internet Business
Now, this is a vast area of various opportunities. Selling online will cost you very less. But they are profitable businesses. You can sell products on online market places such as Lazada, Shopee or 11th street. Though it must be remembered that, you have to create a prior account in that online market website beforehand in order to set your virtual market. This will cost you between RM100 – RM10, 000
Selling software
Well, if you have the knowledge of how to develop software, then this is an ideal business venture for you! You could develop software and get paid monthly or yearly as per usage. This will cost you between RM.200, 000 – 3,000,000. You have the opportunity to enjoy revenue for a long time.
This article intends to give you an idea of how much it would cost you when starting a new business in Malaysia.
First of all, you will need to have a clear scope of your business. Designing a Business Plan is crucial. You will be able to avoid unnecessary expenses and also save time.
Market research is often ignored by entrepreneurs. Instead, may want to conduct thorough research. Extensive research is recommended before taking the plunge. You can opt to do this by yourself or you can even hire a research company to carry it out for you. This can cost you approximately RM4000 for brief research. In-Depth research may cost more.
Initial capital is important to any business. Small enterprises such as online businesses, freelance, and home-based businesses do not require high startup costs. Capital for small businesses may be raised through family or a small bank loan. A business loan is accompanied by an interest rate. Malaysian Banks offer up to RM 3,000,000 for 3-year tenure at a 5% interest rate. Thus, your monthly instalment will be about RM4800.
Your business will have legal requirements to function smoothly. All businesses must register with SSM (Companies Commission of Malaysia). These are the costs you will have to deal with.
Application for reservation of name of the company: RM50 per month
Registration Fee differs from the type of business you are willing to open.
- Company Limited by share – RM1000
- A company limited by guarantee – RM3000
- Unlimited Company – RM1000
- Limited Liability Partnership – RM500
For a sole proprietorship business;
- Trade name – RM60 per year
- Personal name – RM 30 per year
- Branches – RM5 per year per branch
You will need to choose a suitable location. Rent will depend on the area you choose.
Every business will need equipment. Computers, chairs, desks, air conditioners to name a few. You need to allocate sufficient funds to purchase items necessary.
You will need to advertise your business to inform your customers about your product or service. A significant amount of funds will need to be necessary for this.
- Logo (RM800)
- Website (RM3, 500)
- Brochures (RM1000 FOR 500, A2 double-sided brochures)
- Business cards (RM40 for 3 boxes)
- Signage (RM5, 000)
- Domain host fees (RM300)
- All this adds up to approximately RM10, 640.
Then, the important people at your workplace need to be considered. Your employees are who will help you run your business. Their wages need to be considered as well.
This is just a basic framework to help you wrap your head around expenses that may incur. We shall be happy to assist you should you have any other clarification. We have a dedicated and experienced team at S&F Consulting. Please call us on the numbers provided.
Read more: How to Effectively Manage Your Budget When Starting a Business
