In India, a budget of ₹5 lakh opens up real opportunities for starting a scalable micro or small business. Whether you're entering product manufacturing, local services, or digital ventures, this capital can fund better equipment, raw materials, initial inventory, store setup, or a full-fledged digital presence.
Who this is for
First-time entrepreneurs
MSME founders looking to scale
Homemakers, job switchers, or laid-off professionals starting afresh
What This Guide Covers
25 business ideas spread across Manufacturing, Products and Services under ₹5 lakh
Setup cost breakdowns and growth potential
Suitable sales channels: offline, online, or both
Digital tools and licensing essentials
Government schemes for MSMEs
How to Use This Guide
Each business idea includes:
Typical setup cost (within ₹5 lakh)
What the business involves in practice
Primary customer channels
One realistic growth insight
All ideas listed here belong exclusively to the ₹5 lakh budget and will not appear in other budget guides.
Table of Contents
Manufacturing Business Ideas (Under ₹5 Lakh)
Manufacturing at this level involves assembly, conversion, or light fabrication, not heavy industrial production.
1. LED Bulb Assembly Unit
Typical setup cost: ₹3–4.5 lakh
Assembling LED bulbs using bought-out components.
What you need: Assembly tools, soldering equipment, components, workspace.
Where to sell: Electrical shops, local distributors, institutional buyers.
Growth insight: Bulk institutional orders stabilise cash flow.
2. Electrical Fittings Assembly (Holders, Switches)
Typical setup cost: ₹3–5 lakh
Assembling basic electrical fittings used in homes and offices.
What you need: Assembly tables, components, quality testing tools.
Where to sell: Electrical wholesalers, contractors.
Growth insight: Consistency and defect control matter more than branding.
3. Eco-Friendly Packaging Conversion Unit
Typical setup cost: ₹2.5–4 lakh
Converting paper and eco-materials into bags and wraps.
What you need: Cutting tools, raw material stock, packaging space.
Where to sell: Food outlets, handicraft sellers, D2C brands.
Growth insight: B2B contracts ensure predictable volumes.
4. Decorative Candle Mould Manufacturing
Typical setup cost: ₹2.5–4 lakh
Producing moulded decorative candles in bulk.
What you need: Moulds, wax melting equipment, finishing tools.
Where to sell: Wholesalers, gift stores, online sellers.
Growth insight: Seasonal planning prevents inventory pile-up.
5. Sheet-Metal Conversion / Light Fabrication
Typical setup cost: ₹4–5 lakh
Fabricating simple metal items like brackets or enclosures.
What you need: Cutting, bending tools, safety equipment.
Where to sell: Local industries, contractors.
Growth insight: Repeat industrial clients matter more than one-off jobs.
6. Plastic Conversion Unit (Job-Assisted)
Typical setup cost: ₹4–5 lakh
Converting plastic sheets or components into finished goods.
What you need: Conversion machines, mould access, workspace.
Where to sell: Manufacturers, local suppliers.
Growth insight: Job work reduces inventory risk initially.
7. Aluminium Utensil Fabrication (Basic Range)
Typical setup cost: ₹3.5–5 lakh
Manufacturing simple household aluminium utensils.
What you need: Pressing tools, raw sheets, finishing equipment.
Where to sell: Wholesale markets, retailers.
Growth insight: Standard sizes simplify production.
8. Simple Agricultural Implements Manufacturing
Typical setup cost: ₹4–5 lakh
Producing basic farm tools and accessories.
What you need: Fabrication tools, raw metal, finishing.
Where to sell: Agri-stores, rural distributors.
Growth insight: Local dealer networks drive volume.
Product / Goods-Based Business Ideas (Under ₹5 Lakh)
These businesses depend on inventory depth, credit discipline, and distribution, not manufacturing.
1. B2B Industrial Consumables Trading
Typical setup cost: ₹4–5 lakh
Trading gloves, lubricants, fasteners, safety items.
Where to sell: Factories, workshops, MSMEs.
Growth insight: Wide SKU availability builds loyalty.
2. Electrical and Lighting Wholesale Distribution
Typical setup cost: ₹4–5 lakh
Supplying lights, cables, switches.
Where to sell: Retailers, contractors.
Growth insight: Project-based supply improves order size.
3. Building Materials Trading (Small Scale)
Typical setup cost: ₹4–5 lakh
Trading tiles, fittings, sanitaryware.
Where to sell: Local builders, home renovators.
Growth insight: Fast delivery wins contracts.
4. Two-Wheeler Spare Parts Trading
Typical setup cost: ₹3–5 lakh
Supplying common replacement parts.
Where to sell: Garages, service centres.
Growth insight: Fast-moving parts reduce dead stock.
5. Hardware and Fasteners Trading
Typical setup cost: ₹3.5–5 lakh
Trading nuts, bolts, tools.
Where to sell: Workshops, contractors.
Growth insight: Complete kits sell better than individual items.
6. Agri-Inputs Trading (Seeds and Tools)
Typical setup cost: ₹4–5 lakh
Supplying seeds, tools, accessories.
Where to sell: Agri-stores, farmers.
Growth insight: Seasonal stocking is critical.
7. Office Furniture Trading (Ready-Made)
Typical setup cost: ₹4–5 lakh
Trading desks, chairs, storage units.
Where to sell: Offices, institutions.
Growth insight: Bulk institutional sales improve margins.
8. Safety Equipment and PPE Trading
Typical setup cost: ₹3.5–5 lakh
Supplying helmets, gloves, safety shoes.
Where to sell: Factories, construction sites.
Growth insight: Compliance-driven demand is stable.
9. Plumbing Materials Distribution
Typical setup cost: ₹4–5 lakh
Trading pipes, fittings, valves.
Where to sell: Plumbers, contractors.
Growth insight: Availability matters more than discounts.
Service-Based Business Ideas (Under ₹5 Lakh)
These businesses rely on teams, systems, and local trust, not just individual skill.
1. Event Planning and Décor (Mid-Scale)
Typical setup cost: ₹3–5 lakh
Managing weddings, parties, corporate events.
Growth insight: Vendor coordination is the real asset.
2. Boutique Laundry and Dry Cleaning
Typical setup cost: ₹4–5 lakh
Local laundry with pickup and delivery.
Growth insight: Monthly plans stabilise revenue.
3. Mobile Car Wash and Detailing
Typical setup cost: ₹2–3 lakh
On-site car cleaning services.
Growth insight: Apartment tie-ups reduce marketing costs.
4. Hyperlocal Courier and Delivery Service
Typical setup cost: ₹3–5 lakh
Local delivery for shops and sellers.
Growth insight: B2B clients outperform one-time users.
5. Digital Printing and Local Branding Services
Typical setup cost: ₹2–4 lakh
Flex boards, banners, signage.
Growth insight: Local political and retail demand is consistent.
6. Online Course Business (Recorded)
Typical setup cost: ₹3–4 lakh
Selling structured recorded courses.
Growth insight: Outcome-based positioning converts better.
7. Co-Working or Shared Workspace (Micro)
Typical setup cost: ₹4–5 lakh
Small shared office space.
Growth insight: Community events increase occupancy.
8. Home-Based Bookkeeping Firm (Multi-Client)
Typical setup cost: ₹2–3 lakh
Managing accounts for small businesses.
Growth insight: Retainers beat project work.
Closing Perspective
At ₹5 lakh, success depends less on the idea and more on:
Cost control
Operational discipline
Local credibility
These businesses are not shortcuts to scale. They are structured foundations.
Need suppliers or bulk products related to this?
Join our pan-India B2B WhatsApp Bazaar for buying and selling goods.
Disclaimer
The business ideas and budget estimates provided in this guide are intended as general guidelines. The actual costs of starting and running a business may vary based on various factors such as location, local market conditions, government regulations, resource availability, and other on-ground challenges. It is recommended to conduct thorough market research and consult with industry experts or financial advisors before making any investments.