10 Most Profitable Small Businesses in Australia

27 September, 2024 · 7 min read

Author

Nikita Filippov

Discover the most profitable small business ideas in Australia and learn how to tap into lucrative markets to ensure long-term success and growth.

Final Thoughts

Australia is often hailed as the land of opportunity, and for good reason – it's a place where entrepreneurs can flourish in a variety of industries.

If you're considering starting a business, choosing the right sector can be the deciding factor between success and struggle.

Let's take a closer look at some of the most profitable small businesses in Australia, break down the numbers behind their success, and uncover why they hold such appeal for aspiring business owners.

1. Professional Services: Turning Expertise Into Profit

If you have skills or expertise – whether in accounting, legal consulting, or business advisory – you already hold the key to success.

Professional services are highly in demand and offer some of the highest profit margins, often because they require minimal overhead to start.

Why It's Profitable:

Profit margin: 15-30%.
Low startup costs and the ability to set your own rates.
High demand across industries such as finance, law, and IT consulting.

For example, the accounting profession in Australia has been grappling with a shortage of skilled workers for several years.

According to the Australian Bureau of Statistics, the demand for accountants has steadily increased, placing accounting roles among the top 10 most in-demand occupations. Projections indicate that by 2026, Australia will need 338,362 accountants – requiring nearly 10,000 additional professionals each year.

Offering professional services allows you to build relationships with long-term clients who value specialized knowledge, making this sector consistently profitable.

2. Health and Wellness: Catering to Australia's Well-being Boom

The wellness industry is booming, and Australia is no exception.

Whether it's fitness training, yoga classes, or wellness coaching, Australians are increasingly investing in their physical and mental health. If you have a passion for health, starting a business in this sector could be your golden ticket.

Why It's Profitable:

Profit margin: 15-25%.
The wellness industry is rapidly growing, with a CAGR of 5.46% from 2023 to 2030.
Increased awareness of preventive healthcare and fitness solutions.

Australians are more health-conscious than ever before, making businesses like gyms, personal training, physiotherapy, and yoga studios lucrative.

Many of these businesses require minimal equipment or startup capital and can be scaled easily through membership models.

3. E-Commerce: The Digital Marketplace of Opportunity

Online retail has revolutionized how Australians shop, and the trend shows no signs of slowing.

Starting an e-commerce business allows you to reach customers all across the country – and beyond – without the need for a physical store.

With the right products and marketing strategy, this sector offers virtually endless possibilities.

Why It's Profitable:

Profit margin: 10-30%, depending on the products sold.
Australian online retail sales surpassed $62 billion in 2021.
Lower overhead compared to brick-and-mortar businesses.

From niche products like eco-friendly goods to high-demand items like fashion and tech, online retail businesses can be started from home with minimal risk.

With so many eCommerce platforms, like Shopify or Etsy, you can get started quickly and easily scale once demand grows.

4. Construction and Home Improvement: Building Australia’s Future

Australia's thriving housing market has led to a high demand for construction and home improvement services.

Whether you're in plumbing, electrical work, or general contracting, there's a consistent need for skilled tradespeople to keep up with home building, renovations, and repairs.

Why It's Profitable:

Profit margin: 5-30%, depending on the specialization.
The Australian construction industry is valued at $360 billion.
Specialized trades like electrical work or plumbing often see higher margins due to their expertise.

Australians are always looking for ways to improve their homes, whether it's through energy-efficient upgrades or aesthetic renovations.

The ability to offer specialized services allows small businesses in this industry to charge premium prices.

5. Food and Beverage: Serving Australia’s Love for Dining Out

Australians love their coffee, food, and dining experiences.

Cafes, restaurants, and food trucks are an integral part of the country's lifestyle, with new and innovative food ventures consistently finding success.

So, if you are passionate about creating unique dishes or have a talent for hospitality, this sector holds massive potential for growth.

Why It's Profitable:

Profit margin: 5-20%, depending on the business model.
The food service industry is projected to generate $76 billion by 2025.
Australia has a strong café culture, particularly in major cities like Melbourne and Sydney.

Food businesses can be tailored to specific niches, such as vegan restaurants, gourmet food trucks, or artisanal bakeries, allowing you to carve out a unique market position.

While initial startup costs can be higher, a strong concept paired with a good location can yield substantial rewards.

6. Real Estate Agencies: Navigating Australia’s Property Market

The Australian property market has been a key driver of economic activity for years, and there's always room for independent real estate agents and agencies to thrive.

You can help families find their dream homes or manage rental properties; either way, real estate businesses offer significant income potential.

Why It's Profitable:

Profit margin: 10-20%.
Australia's property market is valued at over $10 trillion, with rental properties seeing increasing demand.
Real estate agents earn commissions on high-value transactions, which can translate into significant earnings for relatively low costs.

If you are an outgoing person with strong networks and market knowledge, property management or boutique real estate agencies can also offer steady, recurring revenue, particularly in urban centers where housing demand remains strong.

7. Digital Marketing and SEO: The Power of Online Presence

As businesses increasingly shift online, the need for experts who can help them thrive in the digital landscape has grown exponentially.

Digital marketing and SEO services are in high demand as companies look to boost their online visibility and reach customers through social media, websites, and search engines.

Why It's Profitable:

Profit margin: 15-40%.
Australia's digital advertising market was worth $11 billion in 2022.
Low startup costs and high demand make it a prime sector for profitability.

If you have a knack for SEO, social media management, or content marketing, you can start a business with minimal investment and attract clients from around the world.

With businesses of all sizes looking to strengthen their digital presence, the opportunity to grow a successful digital marketing agency or go freelance has never been greater.

8. Cleaning Services: A Reliable and Recurring Business

Sometimes, the most profitable businesses are also the simplest.

There is a steady demand for both residential and commercial cleaning servicesare, making this a consistent and reliable sector for small business owners.

If you focus on quality service and efficiency, you can quickly establish a strong customer base.

Why It's Profitable:

Profit margin: 10-28%.
Australia's cleaning industry is valued at over $13 billion.
Minimal startup costs with the potential for recurring clients.

Whether you focus on office, residential, or niche services like carpet or window cleaning, this industry offers flexibility and the opportunity to scale your business as demand grows.

9. Childcare Services: Supporting Working Families

With more dual-income households, there's an increasing need for reliable childcare services in Australia.

Starting a childcare business, such as a family daycare, after-school program, or nanny service, can provide a rewarding career with strong financial potential.

Why It's Profitable:

Profit margin: 10-15%.
The Australian childcare industry is valued at $10 billion.
With 1.3 million children currently in childcare, demand is steady.

Trust is key in this sector, and building a reputation for providing safe, high-quality care will allow you to attract and retain clients over the long term.

10. IT Support and Services: Solving Digital Challenges

As businesses become more reliant on technology, the demand for IT support is skyrocketing.

Whether providing network solutions, cybersecurity or managed IT services, this sector is ripe for entrepreneurs with technical expertise.

Why It's Profitable:

Profit margin: 15-30%.
The Australian IT services market is expected to grow to US$48.26bn by 2029.
The ability to offer remote services adds flexibility and scalability.

If you have a background in tech, you can quickly establish a business that provides essential services to both small businesses and large corporations, making this a highly profitable and scalable venture.

Final Thoughts

As you consider which path to take and join the company of the most profitable small businesses in Australia, balancing passion with market demand is important.

Whether you're drawn to e-commerce, skilled trades like construction, or the service-driven world of health and wellness, Australia offers numerous opportunities to succeed.

The most important step? Getting started.

But the process of starting a business doesn't stop at choosing the right industry.

As any experienced entrepreneur will tell you, it is crucial to ensure your business is properly registered and compliant. ANNA One can transform your startup journey in this area.

Why Small Businesses Benefit from ANNA

Many new entrepreneurs get bogged down by business registration, tax management, and bookkeeping complexities – but it doesn't have to be that way.

ANNA One simplifies everything, giving you more time to focus on growing your business.

ANNA offers a streamlined way to register your company. Its services cover everything from obtaining an Australian Company Number (ACN) to managing your Australian Business Number (ABN).

With integrated banking, bookkeeping, invoicing, and tax filing into one platform, ANNA eliminates the need for separate services.

Here's why using ANNA for your small business is a game-changer:

⚡ Quick and Easy Business Registration

ANNA allows you to register your company and get your ACN seamlessly. You can:

Check the availability of your company name instantly.
Register both your ACN and ABN in one place.
Receive all official documents directly in your inbox.

⚡ Comprehensive Business Support

Once registered, ANNA offers a suite of features designed to keep your business compliant and efficient:

Invoicing: Send professional invoices quickly and easily. With ANNA's invoice-chasing feature, 80% of invoices are paid within a week.
Bookkeeping: Forget paper receipts— simply snap pictures of receipts, and they will be automatically categorized and matched with the right transactions.
Tax Management: ANNA makes managing your taxes simple and stress-free. It offers automatic GST and tax calculations, personalized tax calendars, and support for lodging your annual tax return.

⚡ One-Stop Business Banking

With ANNA One, you not only register your business but also get access to:

Business debit cards and virtual cards for purchases.
Expense management tools to keep track of employee spending.
Integration with other bank accounts so you can see all your finances in one place.

⚡ Save Time and Focus on Growth

As a new business owner, your time is one of your most valuable resources.

Instead of juggling multiple platforms and accountants, ANNA streamlines everything, giving you the tools you need to start, run, and grow a happy business from day one.

So, whether you're launching an e-commerce store or opening a new fitness studio, ANNA One ensures that your business is registered, compliant, and equipped for success.

Now's the time to turn your business idea into reality with the support of a platform designed to make life easier for small business owners like you!

Get started with ANNA today, and let your entrepreneurial journey begin on the right foot.