762 UK hospitality businesses closed in Q1 2026 as industry struggles to absorb rising costs
Recurring reasons for closures are weak late-night trading and less consumers drinking.
The number of hospitality businesses entering insolvency remained high at 762 in the first quarter of the year, reflecting challenging trading conditions for the industry, according to Buchler Phillips Hospitality.
This is down 3.7% compared to Q4 2025. In March alone, 268 hospitality businesses closed, broadly flat on February, Buchler Phillips Hospitality said, citing government data.
“The number of monthly hospitality insolvencies has remained consistently over 250 so far this year, after posting 207 for December,” it said.
The Buchler Phillips Hospitality Index of insolvencies, which has tracked monthly figures since January 2014, eased very slightly from 187.3 in December to 180.6 in March. It peaked in August 2023 at 273.4 with a spike in the sector’s business closures.
High-profile operators closing high street units have included TGI Fridays UK, which entered administration again while preserving 33 units in a pre-pack; The Revel Collective, the operator behind Revolution bars; and Greene King, which in March announced plans to sell dozens of pubs and convert around 150 units into franchised or tenanted units.
Recurring factors cited by analysts include late-night trade weakness and younger consumers drinking less. The most vulnerable formats have been ‘experiential’ or themed chains, and cocktail bars.
Pubs, hotels and restaurants are bearing an estimated £3b to £4bn of additional costs. Operators are being forced to lift prices by up to 10% on average, against a background of already depressed trading.
Last year, more than three-quarters of a million hospitality employees were shunted into employers’ NIC for the first time.
“Hospitality is staying near the top of the insolvency table for the time being. The sector is finding it hard to adapt to a higher cost base, and there’s no easy route to recovery, even when an upturn in consumer spending finally arrives,” Jo Milner, Managing Director of Buchler Phillips, said.
