How to Start a Business in Arizona

Arizona has been rated by some of the top business sites (including Forbes) as one of the top states with the highest and best economic growth; making the state a place of immense potential for entrepreneurs.

In fact, the state has been rated 6th in entrepreneurship, 5th in economic growth prospects, and 12th in access to funding.

With the ever-expanding business opportunities and ideas for entrepreneurs to take advantage of, it might be difficult to pick out the most suitable business idea that would be profitable in the state of Arizona.

Here are some of the best business ideas in Arizona;

  • Debt Collection Agency
  • Pool Installation Business
  • Billboard Advertising Agency
  • Jewellery Store
  • Kids Taxi Service
  • Costume Rental Business

So, let’s take a look into how to start a successful business venture in Arizona.

» Choosing an Entity Type

In Arizona, businesses have the option of choosing between the corporation, non-profit corporation, and a Limited Liability Company as their business structure.

The S Corp and C Corp entities are federal tax designations, and in Arizona, it is better to just from a non-profit corporation or a corporate business structure.

For valuable information and advice on the structure suitable for your business according to tax, liability, and other business related issues, the advice of an attorney or accountant can be employed.

Also, entrepreneurs can visit the Arizona Commerce Authority Small Business Services for valuable insight.

» How to Establish a Sole Proprietorship in Arizona?

Establishing a sole proprietorship in Arizona can be easily done by following some simple steps.

  • Choose your Business Name

A sole proprietor business may be attributed an assumed name or make use of their brand name, in Arizona.

This business name should be chosen keeping other closely related product and business trademarked names in mind to avoid federal and local laws.

You and run searches in the government catalogs to avoid using a name that is already taken by another business.

Business entrepreneurs can run searches in the Arizona Secretary of State Database and search under a registered name, or go to the local county office where you plan to start your business and make inquiries with the county officer.

  • Register the Trade Name

Arizona laws do not make it mandatory that businesses register brand names that differ from their legal names, but it is a practice that most business owners stick to.

Entrepreneurs can file to have their business names registered with the Arizona Secretary of State, and the trade name must be unique, and not shared with another registered business.

The fee for this name registration is only $10, and you can visit the Arizona Secretary of State website to find out more details.

  • Get Legal Licensing, Permits and Clearance

Depending on the kind of business you are planning to start and your business activities, you will need to obtain various permits and licensing for your business.

Or sole proprietorship businesses, the State of Arizona provides a comprehensive database on the licensing requirements for each occupation and business niche.

Consultation with your local or county clerk might be required, to ascertain if your business will need building and local regulation permits.

These permits are necessary for the smooth and legal running of your business. There are necessary state, federal, and local regulations in place concerning permits for varying business types, and you will have to make the obligatory research.

For example, a diner or restaurant might need health and building permits.

  • Obtain an EIN (Employee Identification Number)

If your business is going to be one with employees and hired help, you will be required to obtain an Employee Identification Number for tax-related issues.

Businesses with employees will need to make financial reports with their EIN to the Internal Revenue Service.

An EIN can be acquired from the IRS office or can be easily registered from the IRS website.

For sole proprietors with no employees, however, Social Security numbers can be used to report taxes and open business bank accounts.

Businesses in Arizona must make reports within 20 days of hiring new employees, and the Employee Identification Number, and also pay employment taxes during the scheduled time.

» How to Start a Limited Liability Company in Arizona?

For entrepreneurs looking to start a small business in Arizona, a Limited Liability Company might be the most favorable when compared to other business structures.

Your company will get the advantages of being protected from personal liability in case of lawsuits, and your business is given some extra credibility.

LLCs are also easier to manage and set up, and the tax benefits for small businesses are favorable.

The fees for setting up as a Limited Liability Company in Arizona varies according to the county, but a business owner can set up a Limited Liability Company in the State of Arizona for $90 – $210.

» Obtaining Proper Insurance

Sole proprietorship businesses and small businesses will be better off obtaining general liability insurance, as sole proprietors are solely in charge of all financial obligations of the business.

Moreover, this form of insurance may be the best option in terms of offering protection in matters of financial troubles.

» Advertise and Market

Proper advertisement for your business is essential to certify its success. Modern times have made social media and websites the most popular, budget-friendly and strategic means of advertising service and products.

The first things business owners can do in terms of proper media advertising is creating a highly informative, professional website that showcases what your brand stands for.

Businesses will also need to create a logo and brand image that is in sync with the brand’s goal. The logo should be memorable, unique and of high-quality design.

Consumers and potential clients will glean their first impressions of the business from the logo, packaging, or brand image, and it is important that the impression should be one of quality, professionalism, and superiority.


With these simple steps guiding on how to start a business in Arizona, no doubt the seemingly undecipherable legal obligations and laws seem more easily achieved.

Starting a business in Arizona can be easily achieved, and with the proper business ideas, most entrepreneurs will watch their businesses grow larger and more profitable.