1. Understanding the Phoenix Restaurant Market
Phoenix is one of the fastest-growing cities in America, making it an exciting—and competitive—market for restaurants. The Phoenix metro area has over 5 million residents and welcomes millions of tourists annually, creating robust demand for diverse dining options.
Phoenix Restaurant Market Facts
- • Over 10,000 restaurants operate in the Phoenix metro area
- • Residents dine out an average of 4-5 times per week
- • Tourism contributes $25+ billion annually to Arizona's economy
- • Fast-casual and ethnic cuisines are fastest-growing segments
Hot Neighborhoods for Restaurants
Downtown Phoenix
High foot traffic, entertainment district, sports venues
Old Town Scottsdale
Tourist destination, nightlife, upscale dining
Tempe (Mill Avenue)
ASU campus, young demographics, casual concepts
Gilbert
Family-friendly, growing suburbs, heritage district
2. Business Planning & Concept Development
Before spending a dollar on equipment or signing a lease, you need a solid business plan. This document will guide every decision you make and is essential for securing financing.
Key Elements of Your Restaurant Business Plan
Executive Summary
Your concept, target market, unique value proposition, and financial projections overview.
Concept & Menu
Define your cuisine, service style (fast-casual, full-service, etc.), and preliminary menu with food costs.
Market Analysis
Research your competition, target demographics, and location viability in the Phoenix area.
Financial Projections
Startup costs, operating expenses, revenue projections, and break-even analysis.
Operations Plan
Staffing needs, hours of operation, supplier relationships, and day-to-day management.
3. Permits & Licensing in Arizona
Opening a restaurant in Phoenix requires multiple permits and licenses. Start this process early—some approvals can take weeks or months.
| Permit/License | Issuing Agency | Approximate Cost |
|---|---|---|
| Business License | City of Phoenix | $50 - $200 |
| Food Establishment License | Maricopa County Environmental Services | $400 - $800 |
| Food Handler Certifications | Approved training providers | $10 - $15 per employee |
| Food Manager Certification | ANSI-accredited programs | $100 - $150 |
| Liquor License (if serving alcohol) | Arizona Dept. of Liquor | $1,000 - $100,000+ |
| Fire Department Permit | Phoenix Fire Department | $100 - $500 |
| Signage Permit | City Planning Department | $100 - $300 |
| Transaction Privilege Tax License | Arizona Dept. of Revenue | $12 |
Pro Tip: Health Department Inspections
Schedule your Maricopa County health inspection early. They'll review your kitchen layout, equipment, ventilation, and food safety procedures. Make sure your equipment meets all requirements before the inspection.
4. Choosing Your Location
Location can make or break a restaurant. Consider these factors when searching for space in the Phoenix area:
Location Checklist
- ✓ Visibility from major roads
- ✓ Adequate parking (critical in Phoenix)
- ✓ Foot traffic patterns
- ✓ Demographics match your concept
- ✓ Competition density
- ✓ Accessibility and signage options
Space Requirements
- ✓ Kitchen size (minimum 40% of total)
- ✓ Proper ventilation/hood capacity
- ✓ Grease trap requirements
- ✓ Electrical capacity for equipment
- ✓ Walk-in cooler space or build-out
- ✓ ADA compliance
Phoenix Area Lease Rates (2024)
Downtown Phoenix
$25 - $45/sq ft
Scottsdale
$30 - $55/sq ft
Suburbs (Mesa, Gilbert)
$18 - $30/sq ft
5. Kitchen Equipment Essentials
Your kitchen equipment is the foundation of your operation. The right equipment improves efficiency, consistency, and food quality. The wrong equipment wastes money and creates bottlenecks.
Save 50-70% on Equipment
At EEL Economic Equipment Locators, we help Phoenix restaurant owners save tens of thousands on quality used commercial kitchen equipment. Our founder, a former executive chef, can help you select exactly what you need.
Browse Our EquipmentEssential Equipment Categories
Refrigeration (Critical in Arizona!)
- • Walk-in cooler and/or freezer
- • Reach-in refrigerators and freezers
- • Prep tables with refrigeration
- • Ice machines
- • Display merchandisers (if applicable)
Cooking Equipment
- • Commercial range with oven
- • Convection oven (highly recommended)
- • Fryers
- • Griddle and/or charbroiler
- • Steam equipment (depending on concept)
Food Prep
- • Work tables and prep stations
- • Commercial mixer
- • Food processor
- • Slicers (meat, vegetables)
- • Smallwares (pots, pans, utensils)
Sanitation & Safety
- • 3-compartment sink
- • Hand washing stations
- • Commercial dishwasher
- • Exhaust hood with fire suppression
- • Grease trap
6. Startup Costs Breakdown
Restaurant startup costs in Phoenix vary widely based on concept, location, and whether you're building out new space or taking over an existing restaurant. Here's a realistic breakdown:
| Category | Small Restaurant | Full-Service |
|---|---|---|
| Lease Deposit & Rent | $15,000 - $30,000 | $40,000 - $80,000 |
| Build-Out & Renovations | $50,000 - $100,000 | $150,000 - $350,000 |
| Kitchen Equipment (New) | $40,000 - $80,000 | $80,000 - $150,000 |
| Kitchen Equipment (Used from EEL) | $15,000 - $35,000 | $30,000 - $60,000 |
| Furniture & Decor | $10,000 - $25,000 | $30,000 - $75,000 |
| Permits & Licenses | $2,000 - $5,000 | $5,000 - $15,000 |
| Initial Inventory | $5,000 - $10,000 | $15,000 - $30,000 |
| Marketing & Signage | $5,000 - $15,000 | $15,000 - $40,000 |
| Working Capital (3 months) | $30,000 - $50,000 | $75,000 - $150,000 |
| TOTAL (with used equipment) | $130,000 - $270,000 | $360,000 - $800,000 |
7. Pro Tips from a Phoenix Restaurant Veteran
Our founder has opened and operated restaurants throughout Arizona. Here's his advice for new Phoenix restaurateurs:
"Don't Overbuild Your Kitchen"
Start with essential equipment and add more as you grow. Many new owners buy equipment they never use. We can help you identify exactly what you need for your menu and volume.
— Amando Solorio, Founder
"Arizona Heat Is No Joke"
Invest in quality refrigeration—your equipment works harder here than anywhere else. A cheap refrigerator that fails in July can cost you thousands in spoiled food and lost business.
— Amando Solorio, Founder
"Keep 6 Months of Operating Capital"
Most restaurant failures happen because owners run out of cash before building a customer base. Save aggressively on startup costs (like buying used equipment) so you have runway to succeed.
— Amando Solorio, Founder