List of Franchise Under 5 Lakhs: Top Affordable Business Opportunities in 2025

Opening a business through franchising is a great way to minimize the risk of setting up a new venture. With limited capital, aspiring entrepreneurs can explore franchises below five lakhs and own a business within a cost-effective option.

Scarcely funded, these several franchises obtain profitable opportunities across various sectors like food, retail, education, health, and services.

In this extensive guide, we shall consider some of the best franchise options under 5 lakhs in addition to their benefits, investment breakup, and other important details to help you make an informed decision.

Why Choose a Franchise Under 5 Lakhs?

Some Advantages Always Hold for an Entrepreneur Visiting for the Very First Time or a Small Business Owner Struggling to Expand.

So, here are some reasons to opt for this option:

1. Low Financial Risk– Less than 5 lakhs investment gives tremendous relief on finance and even risk.
2. Proven Business Model– The franchises have recognized brands and working systems, and thus have fewer chances of failure.
3. Training and Support– Mostly, franchises offer instant and helpful training, marketing content, and support operations to franchisees to help make their business successful.
4. Wide range of options: Sectors like food, retail, education, and health services provide multiple opportunities under this budget.
5. Fast returns: Lower overhead and proven profitability make many franchises offer faster returns on their investments.

Also read: 10 Most Popular Franchise Business in India for 2025

Top Sectors Offering Franchises Under 5 Lakhs

Several industries have recognized the need for affordable franchise models to cater to budding entrepreneurs. Let’s dive into the prominent sectors and their best offerings:

1. Food and Beverage Franchises

A. Tea Time

How to Invest: ₹3 Lakhs – ₹5 Lakhs
Business Idea: To produce-the-top-notch-smoothest-teas-with-snacks-quick-services-beves.

Why Tea Time?

It has a low-cost start-up and huge consumption demand for tea-based beverages. It is best suited for small kiosks and makes very soon quick breakeven and steady returns.

B. Chaat Adda 

Investment: ₹2.5 Lakhs – ₹4 Lakhs
Business Idea: Indian Street food such as pani puri, bhel puri and samosas.
Promotion Points: Low inventory cost. High-margin products. Strong franchisee support system.

C. Lassi Corner

Investment: ₹3.5 Lakhs – ₹4.5 Lakhs.
Business Idea: Flavoured lassis, milkshakes, and other beverages.
Perks: The Lassi Corner menu will be popular for all age groups and so have many clients to offer its product to.

2. Retail Franchises

A. Khadi India 

Investment: ₹2 Lakhs-₹4 Lakhs
Business Concept: Eco-friendly, handmade products like clothes, accessories, and home decor.
Benefits: Top quality backed government brand. Increased demand for all-natural and sustainable products. 

B. Patanjali Store. 

Investment: INR 4.5 Lakhs.
Business Concept: Ayurvedic and herbal products ranging from food to skincare and health supplements.

Why Patanjali?

Patanjali is considered one of the most secure low-cost franchising options available. Due to the outstanding brand power and increasing number of consumers. 

C. MiniSo Cart Franchise.

Investment: INR 4 Lakhs-5 Lakhs.
Business Concept: Selling lifestyle accessories or trendy stationery and home accessories. Highlights: Compact setup models. Has cooler brands for the younger crowd.

3. Education Franchises

A. Kidzee Pre-School

Initial investment: ₹3 Lakhs to ₹5 Lakhs
Concept: Early child education and daycare services. 

Benefits:

• Established curriculum and methodologies.
• Sustained demand even in urban or rural areas for quality preschools.

B. British Lingua

Investment: ₹4 Lakhs – ₹5 Lakhs
Business Model: Spoken English and personality development training.

USPs (Unique Selling Features):

• Setup with the least requirements to be at a very low cost.
• Greater profitability because of increased demand for the English education.

C. Abacus Learning Center

Investment: Rs 2 lakh-3 lakh
Business Concept: To enhance kids’ mental arithmetic skills using an abacus.

Why Abacus?

This franchise has a bright future due to its low operational costs and the increased interest of parents to develop advanced skills in their children.

4. Health and Wellness Franchises

A. Dr. Batra’s Clinic for Homeopathy

Investments: 4 Lakhs-5 Lakhs Rupees
Nature of Business: Homeopathy Treatment for Various Sicknesses

Salient Features:

• The trust of the customers in this brand is high.
• Marketing and Clinic Management Support.

B. Sanitary Napkin Vending Machines

Investment: 3.5 Lakhs-4 Lakhs Rupees

Nature of Business: Installing the Machine and Trading in Sanitary Pads

Benefits:

• Meets one of the basic health needs.
• Requires minimal maintenance.

C. Ayurvedic Herbal Spa

Investment: 4 Lakhs-5 Lakhs Rupees

Nature of Business: Therapies, Massages, and Treatments of Well-Being as per Ayurveda

Why invest?

These booming industries “wellness tourism” and “Ayurveda” fetch huge returns.

5. Service-Based Franchises

A. UrbanClap Partner Franchise

Investment: ₹2 Lakhs – ₹4 Lakhs
Business Model: A digital platform through which home services like cleaning, plumbing, and beautification can be availed.

Advantages:

• No place is needed to keep the goods.
• One can run it from the comfort of home, and no question of timing arises.

B. Courier and Logistics Services

Some DTDC, Blue Dart (Mini Franchise Models)

Investment: 3-5 lakh

Why Choose Logistics?

During this period, there was a rapid increase in e-commerce, which made the courier and logistics business booming. 

C. Housekeeping Services

Investment: 2.5-4.5 lakh

Business Concept: Cleaning as well as maintaining the homes and offices.

USP: Focusing more on urban areas where demand is maximum.

6. Technology Franchises

A. e-Mitra Kiosk

Investment: ₹2 Lakhs – ₹3 Lakhs

Business Idea: Delivering online government and utility services to local communities.

Why e-Mitra?

Common services like bill payment, Aadhar updates, and document submissions make this a people’s favourite.

B. Internet and Gaming Zones

Investment: 4 lakh to 5 lakh

Business Plan: Merging the Internet with a gaming arcade for the youth.

Expansion possibility: Growing demand in semi-urban and rural areas.

Key Considerations Before Investing in a Franchise Under 5 Lakhs

Conduct a Research on the Brand

Inspect the brand’s market reputation, and customer reviews and understand its margin profitability. Then check the structure of support so that of training and marketing assistance for a guarantee of the ‘life’ of the business.

Location Matters

Choose a location where demand for products and services offered by the franchise is high. Assess the demographics, competition as well as customer flow to give the business maximum visibility and sales opportunities.

Understand the Agreement

The franchise agreement should indicate the rates of royalties, renewal terms and rights to territory, and exit clauses. If necessary, seek legal interpretation to get rid of any hidden costs and constraints.

Seek Guidance

Consulting other franchise owners will give a complete view of what goes on every day in the business, their income, and eventually the problems they encounter. Learning this will help shape your expectations sensibly and prepare you better.

Be Equipped with a Marketing Plan

Formulate a marketing plan for your franchise to sell your products and services locally. Use all forms available, internet and offline. Depending on the materials provided by the franchisor, your marketing schemes should be customized to meet your audience.

Tips for Securing Franchise Success

It is worthy that the franchise is working towards establishing a proper working foundation and nurturing it for the business growth of its potential franchisee under a maximum of five lakhs. Here are some elaborated tips to lend assurance in the franchise:

Orient Towards Customer Experience

• Personalized Service: this is where you help develop customer loyalty through different interactions and keep track of preferences.
• Feedback Systems: regularly take feedback and implement it to improve your offerings and services.

Adapt to the Market Needs

• Local Insights: Survey or study the local demand to make your offerings available to your franchises. 
• Season Promotions: Run those targeted promotions during that festival or holiday to increase sales.

Training Regularly

• Franchisor Support: Attend all training provided by the franchisor to stay updated on operations and best practices.
• Employee Skill Development: Make sure that the staff under you is trained in customer service and operations. 

Effective Local Marketing

• Social Media Promotions: Use local platforms to engage with your community and share updates.
• Associations: Collaboration with neighbouring businesses or events for co-promotion within the community. 

Financial Disciplines and Punctuality

• Tracking Costs: Record and manage operational expenditures under a budget. 
• Reinvest: Set some of your profits aside for improvements or for localized marketing that promotes growth. 

Leverage Technology

• The payment methods should be UPI, debit cards, credit cards, and wallets for customers to make online payments. 
• POS systems manage inventories effectively and analyze current sales trends.

Check out this: List of Top 100 Profitable Franchise in India

Frequently Asked Questions (FAQs) About Franchise Under 5 Lakhs

1. Which franchises can I set up for less than 5 lakhs investments?

Explore sectors such as food and beverages, retail, education, health and wellness, and online services. You can set up small kiosks, coaching establishments, or even distribution franchises.

2. Does one require prior business experience to run a franchise under 5 lakhs?

Most franchisors provide some training or assistance to franchisees who do not have prior experience with business running; it is, therefore, not necessary to have previous experience in business.

3. How much profit can I expect from a low-cost franchise?

The difference comes from the brand to the industry through the location. However, most low-cost franchises give ROI in 6-18 months.

4. Do low-cost franchises incur recurrent fees or royalties?

Yes, many franchises will require other ongoing fees, such as royalties or marketing contributions. Read through the franchise document carefully to know all financial obligations.

5. How do I pick the best location for my franchise?

Choose a location that is visible as well as has walk-in traffic and demand for the franchised product or services. You must also research the market to gauge competition and the target demographics.

6. What support does the franchisor typically provide?

Support from franchisors is often in terms of training, marketing material formation, operational procedures, and continuous support. The extent varies per brand; thus, it is crucial to know beforehand.

7. Can I customize the franchise offerings based on local preferences?

Franchisors differ in their guidelines regarding flexibility for local adaptation some being more reserved in that about local modification than others. Understand the agreement to know the extent of customization permissible.

8. What are the potential risks of investing in a franchise that costs below 5 lakhs?

Such risks are essentially brand visibility, competition, and low-profit margins concerning franchises that require capital investments running into lakhs. Conduct thorough scrutiny to avert such risks.

9. How do I finance a franchise?

Funds for franchise investment may come from personal savings, loans from banks, or borrowing from friends and family. Some franchisors provide internal financing assistance or have tie-ups with financial institutions.

10. What should I consider before signing a franchise agreement?

These include terms relating to royalties, territory rights, renewal clauses, and exit options. Seek the counsel of a legal expert to ensure the agreement aligns with your business goals.

Conclusion

Franchising below 5 lakhs provides the aspiring business owner with an entire world of possibilities.

Few investments give you the potential to power your route towards financial dependence with an established brand-supplemented model.

Franchising within this breadth can be found whether you are a food lover an educator or into services. 

Take action today, however, research the options that are available to you, and get started on your wonderful entrepreneurship journey! Success in franchising depends equally on yourself, as well as the brand.

Entry cost is, therefore, less, distracting you from giving a judgment on business ownership without excess pressures of finances.

These franchises cater to essentials and targeted trends; thus, they’re sure to do well across markets.

With the right kind of franchise, your dreams of becoming a successful entrepreneur are closer than you think. So, make the right judgment and prepare to make your business mark!