Ten Valley cities ranked among the top 35 cities in Arizona for small businesses including Chandler, Peoria, Phoenix, Goodyear, Scottsdale, Queen Creek, Gilbert, Mesa, Avondale and Bullhead City.
That’s according to a recent study from B2B Reviews, an online platform that provides comprehensive reviews of tools and software for businesses. The study uncovers key factors that make certain locations more favorable for business owners, based on data gathered from between 2020 and 2023.
Chandler is the best city overall for small businesses due to a solid employer firm presence at 5.05% and No. 3 in rapid population growth at 17.77% in that three-year period — tied with Casa Grande. Both cities came in second to Queen Creek, which is the fastest growing city in the state at 25.7%.
Phoenix (No. 3) has 25.17% of the employer firms out of the entire state, followed by Scottsdale (No. 5) at 10.3%. There has been a 3.52% increase in population in the state’s capital city, where the average commercial real estate rent is $26.61. That rate places the city among the top 10 highest rental rates in the state. Despite ranking No. 2 for percentage of employer firms, Scottsdale has some of the highest commercial real estate costs at $33.08, followed by Lake Havasu at $78.
Top 15 Arizona cities for small businesses
Rank: City: City Population Percentage: Population Percent Increase: Percent Employer Firms: Sales Tax Rate: Average Commercial Real Estate Rent/SF: Final Weighted Score.
1 Chandler 3.69% 17.77% 5.05% 11.90% $19.96 88.57
2 Peoria 2.62% 3.52% 2.52% 22.90% $15.10 83.27
3 Phoenix 21.76% 3.52% 25.17% 11.90% $26.61 81.22
4 Goodyear 1.47% 14.28% 1.29% 11.90% $22.79 79.18
5 Scottsdale 3.22% 6.68% 10.30% 11.90% $22.08 78.37
6 Queen Creek 1.01% 25.70% 1.08% 11.90% $23.82 77.96
7 Gilbert 3.63% 2.32% 5.11% 11.90% $23.33 77.96
8 Mesa 6.75% 1.14% 7.59% 11.90% $24.62 77.55
9 Avondale 1.23% 4.44% 0.79% 11.90% $18.40 75.10
10 Bullhead City 0.57% 16.16% 0.60% 11.20% $19.20 74.69
11 Tempe 2.50% 2.43% 4.79% 11.90% $27.45 73.88
12 Tucson 7.22% 2.43% 7.69% 16.70% $19.59 72.24
13 Glendale 3.35% 2.32% 3.23% 11.90% $31.99 72.24
14 Buckeye 1.44% 16.16% 0.48% 11.90% $28.00 71.02
15 Casa Grande 0.84% 17.77% 0.78% 12.30% $18.26 71.02
Steep rental fees is just one of many expenses that a small business owner incurs, making financing a significant challenge for Arizona entrepreneurs. While some bootstrap their ventures, others seek outside funding such as venture capital or small business loans.
According to a 2024 SBA funding study from LendingTree, companies in Arizona received some of the highest average amounts in Small Business Administration loans in 2024, with an average loan amount per company of $595,553. That also makes the Grand Canyon State desirable for small businesses when it comes to getting funding.
The methodology used to analyze the best Arizona cities for small businesses used several factors to determine the ranking, including population size, population growth, percentage of employer firms, county sales tax rates, and average commercial real estate rent.
By Mignon A. Gould – Associate Editor, Phoenix Business Journal. Mar 31, 2025.
