Hospitality Insolvencies Ease – But Challenges Remain

The number of hospitality businesses entering insolvency eased slightly in the first half of 2026, yet remained historically high, reflecting challenging trading conditions for the industry.

Some 1,602 accommodation and food service companies, including hotels, restaurants and pubs, closed in the six months to June 2026, down 6.1% from 1,706 for the first half of 2025, according to government data. Q2, however, saw a 10.2% increase over Q1, with 840 companies in trouble.

Offering little cheer, the number of monthly hospitality insolvencies has remained consistently over 260 so far this year.

The Buchler Phillips Hospitality Index of insolvencies, which has tracked monthly figures since January 2014, rose from 180.6 in March to 199.0 in June. It peaked in August 2023 at 273.4 with a spike in the sector’s business closures.

There were several high profile casualties in Q2. MeatLiquor include MeatLiquor entered administration and was sold in a pre-pack to a vehicle backed by Fulham Shore founder David Page in early June. Leon’s restructuring carried through Q2 and it formally emerged from administration and a Company Voluntary Arrangement VA in May having closed 28 of its 71 locations, leaving a much smaller estate. Revolution Bars continued closure activity, while Restaurant 104, Richard Wilkins’s Michelin-listed Notting Hill restaurant, shut at the end of April after seven years.

Jo Milner, Managing Director of the leading turnaround and restructuring firm, said:

“There may be some easing in the headline insolvency figures, but there is precious little breathing space for hospitality businesses. Margins remain wafer-thin, consumers are still watching what they spend and higher employment and operating costs continue to bite. Hospitality remains near the top of the insolvency league table, and for many otherwise viable businesses there simply isn’t much left in reserve when something goes wrong.”

Pressure intensified from 1 April, when the National Living Wage rose 4.1% to £12.71 an hour and the rate for 18- to 20-year-olds jumped 8.5% to £10.85. UKHospitality estimates the wage increases alone will add £1.4bn to the sector’s annual costs. Businesses are also contending with the 2026 business rates revaluation and a new rates regime, alongside continuing pressure from energy and other operating costs.