Do you want small business ideas in Africa that bring good returns? Are you an investor looking for opportunities to invest your money in Africa?
Africa has raised its investment profile over the last decade, benefiting from an improving macroeconomic environment, reductions in armed conflict, and the spread of democratic institutions.
22 Profitable Business Ideas To Start In Africa
Africa has been concentrated on natural resources; there are exciting opportunities in renewable energy, infrastructure, agriculture, and education.
Africa is a highly resourceful continent in terms of return on investment if you can conduct your feasibility study and tap into the vast market.
The only problem investors face is knowing the excellent business opportunities to invest in. But, if you meet that issue, you can no longer complain because this post is for you.
I will reveal updated small business investment opportunities in Africa that can make you a multi-millionaire in the long term. This sector has been profitable for investors to put their money into, and you don’t get to worry about your investment.
Most Profitable Small Business Opportunities in Africa
1. Real Estate
Just as food and shelter are regarded as one basic human need in Africa and the world, everybody needs a roof over their head. Africa is seriously facing the housing crisis presently, as many prefer living in urban areas to rural areas.
This action has caused an increase in house rent and property prices, making it one of the best good places to invest in real estate right now. This investment opportunity is a juicy offer to entrepreneurs looking for investment opportunities in Africa.
The population of Africans is increasing very fast, and the housing problems are too big for the government to handle. So, they welcome private investors into this sector to help curb this housing problem.
2. Health Care
Healthcare investing includes establishing hospitals, supplying good medical facilities and equipment, manufacturing drugs, providing family planning facilities and services, and many others.
Most people are familiar with the problems facing the health sector in Africa, which has pushed private investors to confront this issue, thereby making money from it. This healthcare sector is vast and diverse.
Investors have an opportunity to invest in different areas, including medical education providers, manufacturers, retailers, distributors, etc.
Still, many investors have only been investing in a few places like retailers and health service providers that can deliver investment returns.
Africa is a well-known continent for agriculture as most countries depend on agriculture for living and others as a source of income. You, as an investor, can start commercial mechanized farming where you tend to gain more, or you can create a mobile restaurant business that provides food to workers on their farms and work sites.
One can invest in agricultural products such as cocoa, plantains, cassava production (consumed by billions of people), beans, maize, vegetables, and fruit milling.
Oil-producing nations like Nigeria and Angola have started focusing on agriculture due to the recent drop in crude oil prices. This is to tell you about the availability of investment opportunities in agriculture.
Ecommerce in Africa is still yet to gain popularity because many people have not been ideally introduced to the operation and its opportunities. Few ones that know about it are using it to fraud innocent ones.
An investor can educate the people on opportunities that e-commerce trading can bring and start up a company that will protect them from internet fraud with good customer service.
Online payment is still a problem in most African countries; investors can create a middleman payment system that helps receive money from international bodies like PayPal and help send the money to the receiver account.
This is one of the most significant setbacks in Africa. The opportunity behind this is to create a solution that can provide electric power better than their previous means. Investing in solar energy won’t be a bad idea because it is very much abundant in Africa, and remember, Africa is a hot continent.
Most African countries enjoy more than half a year of sufficient power supply because their primary source is solar.
But, so many countries don’t even have access to this and are suffering from a shortage of electricity, and this is where you as an investor come in to do business.
6. App Services
These days there is almost an app for anything you want. Africans are welcoming this idea with open hands. If you are looking for suitable hotel accommodation, there are apps for it. If you want to watch African movies, IrokoTV is there for you.
Are you looking for furniture to buy? There is an app for that, and millions of people all over Africa use these apps.
More and more apps are still coming; if you are an intelligent investor, this is an opportunity to invest.
Africa is currently one of the fastest-growing markets for mobile phone users after Asia. Nowadays, everybody in Africa wants to use the latest phone in stock, which makes the demand very high.
Everyone wants to upgrade, including me. Most phones are explicitly produced for Africans, primarily Nigerians, because their demand is very high. Why do you think someone will have a phone with long battery life when there is a 24-power supply in his country?
It is not because that person knows that Africans are suffering from a shortage of electric power; they would buy any phone that will last them in case the light outbreak takes longer.
Phones like BlackBerry, iPhone, and Samsung are costly phones in Africa, but that does not stop the average person from not purchasing them.
15 Profitable Investment Opportunities for African Entrepreneurs
Africa’s potential has remained largely untapped. This has been the case for a long, long time.
However, there has been a marked improvement in recent years. This is coupled with the fact that there’s also an improvement in the quality of education.
The African continent is considered an emerging market. This translates to tremendous growth opportunities.
Given this, we’d focus on investment opportunities for African entrepreneurs.
If you’ve wondered what opportunities can be exploited, you’re right. You only need to read along to find out what investment opportunities you can commit your time and resources to.
Africa is known mainly for its natural resources.
However, the same cannot be said to be true for its growing population. While other sectors have attracted much attention, education continues to struggle. This is a huge and one of the best business opportunities you can tap into.
Although this is capital intensive, adequate planning with limited resources will achieve much.
The real estate sector in Africa is booming due to several reasons.
One of the primary reasons is the rural-urban migration. This has created a strong demand for affordable housing in cities across the continent.
As a result, investments are pouring in to develop this sector. You, too, can take advantage of the growth in this industry. There are also subcategories or areas you can invest in.
Hence, you may choose to become a real estate broker, an agent, or a developer, among others. This, of course, depends on your capacity as well as expertise.
Food processing is big business. Although the same can’t be said of the agricultural industry in Africa. But this is a problem that offers immense opportunities.
As such, they are investing in food processing is one way to tap into this goldmine. The economic effects of food processing are all-encompassing. Farmers get better value for money, and food security is also enhanced in the process.
As an investor, there are lots of areas you should consider. Value addition to crops like tomatoes, rice, fish, and many others can yield significant profits.
Howbeit, knowledge is an integral part of the business. The proper knowledge, as well as the right tools and investments, will guarantee success.
A large majority of Africans have limited access to effective retail services.
Despite this fact, the retail industry in Africa is witnessing a boom. This has led to its being identified as one of the fastest-growing retail markets. Large retail malls are being established, and eCommerce is also thriving! This is one of the best business opportunities around. So, why not think in this direction?
Retail opportunities are also open to small-scale entrepreneurs. You only need to look around to find out what you can do. Dropshipping opportunities exist as well. These give you the chance to own an online store.
With these, you don’t need to keep a physical inventory of products.
Agriculture is the biggest employer of labor in Africa.
However, most forms of agricultural practices are crude. But this is changing. There’s a growing investment in mechanized agriculture. This has turned out to be a lifeline for industries.
But why is that so? Because these are reliant on agricultural produce as raw materials.
Africa also holds the majority of the world’s uncultivated lands. This is profound because of famine and hunger in parts of the continent. You have the opportunity to partake in this multi-billion dollar industry.
By investing in mechanized agriculture or processing, your returns on investment are almost guaranteed.
Power and Renewable Energy
Inadequate power generation has continued to plague the African continent. This has led to the formulation and implementation of policies with little impact. This is a viable area of investment that promises immense possibilities.
As one of the top investment opportunities, renewable energy solutions are some efficient ways of taking advantage. This investment is capital intensive.
As such, you’d need to have this sorted out before takeoff.
Transportation is one of the ways to tap into the vast African market. Over the last decade, there has been a steady growth in the urban population. This isn’t slowing down anytime soon.
Hence, the need to add to the existing transport facilities. Significant brands like Uber and Taxify, among others, have entered the African market.
This is one of the top opportunities you can invest in with significant returns. Apart from urban dwellers, many commuters move between urban and rural centers. This is an opportunity to exploit.
Building and Construction
This is arguably the fastest-growing sector to invest in. Governments across the continent are continuously embarking on massive construction projects.
This infrastructure drive is meant to close the gap in affordable housing. This is also meant to cover the infrastructure deficit. So, why not take part in a vast market?
The building and construction sectors of most economies are booming. By investing in them, you’re taking advantage of such opportunities that promise steady returns on investment.
A problem facing many Africans is access to effective payment solutions. This area is receiving increased attention among investors.
By developing unique and effective payment solutions, you stand the chance of reaching a vast segment of the market. Some African countries, such as Nigeria, offer tremendous potential. This is due to its population strength. Not only that, but it’s also the biggest economy in Africa.
The Beauty and Fashion Industry
Africa’s young population is enormous! This segment of the population wants to look trendy. As such, you can become a solutions provider.
Currently, the fashion industry is booming. This has given rise to a variety of products. These are either imported or manufactured locally. You, too, can become a player in the fashion industry. There are also several niches to choose from.
The growing penetration of the internet across the continent has been beneficial for several reasons. One of these areas is the e-commerce industry.
Many Africans can purchase goods online and deliver them to their doorsteps. There are several success stories.
A few of these include Konga, Jumia, Mall for Africa, and many more.
As an entrepreneur, you can tap into this opportunity by building an online grocery store. You can also become an online merchant. These are only a few areas to invest in the growing e-commerce industry.
As an entrepreneur, you can bring your wealth of knowledge to bear on others. There are lots of entrepreneurs and professionals willing to pay for your skills. Therefore, you can set up a shop in a suitable location. But the type of consulting services you offer depends on your area of specialization. You must also have a passion for what you do.
Under such circumstances, you get to enjoy what you do.
Operating a Fitness Center
A fitness center or gym is a viable investment opportunity to explore. Even so, such a business is best located in large cities. Not only that, but middle and upper-class neighborhoods also attract the highest patronage. These segments of the population will gladly patronize such services. Thankfully, there has been a steady growth in Africa’s middle class.
This has translated to growing economic prosperity for many African cities.
This is good news as it presents exciting investment opportunities. You need to explore the unique needs of your target market first. This allows you to develop a better range of products and services.
The Stock Market
A growing interest in Africa has resulted in substantial financial inflows. This has boosted growth as well as confidence in the African stock markets. This is a viable investment opportunity for entrepreneurs across the continent.
Despite the global economic crisis of 2008, the stock markets have since recovered and are growing. Stock markets are reliable wealth-building tools that can be harnessed.
With growing interests from China, Europe, and America, African stock markets are set to grow further. Hence, there’s no better time than now to take control of your financial destiny.
There are people with bright ideas across Africa in need of startup funding. This area has seen a lot of growth lately.
As an African entrepreneur looking for investment opportunities, this is a great area to commit your investments.
You can connect with other investors to offer crowdfunding services to such bright ideas.
However, a catch is usually crucial; such ideas must be viabmustsonable. Terms need to be set in place to enable smooth business transactions.
These are a few of several investment opportunities for African entrepreneurs. Most of these opportunities aren’t restricted but spread across the continent.
Also, these are practical businesses that can be started with the proper planning and strategy.
However, success depends on several factors. It would help if you had a thorough understanding of the market. This is coupled with a passion for your preferred opportunity. You also need to ask questions as well as find answers to them.
What questions? You may ask. Such include; what opportunities are available where?