Hospitality insolvencies jumped 9 percent between December 2025 and January 2026, as businesses continue to face economic headwinds including high VAT and alcohol duties, as well as rising staff and supply costs.
The latest data from the Insolvency Service has revealed that liquidations across the hospitality sector rose from 205 in December 2025 to 223 in January of this year.
Though the figures reveal a 9 percent increase on a monthly basis, total insolvencies in the sector dropped 18 percent year-on-year from the 273 recorded in January 2025.
“Most hospitality operators held on at the end of last year to capitalise on Christmas trading, before having to assess their options in January,” said RSM’s head of leisure and hospitality Saxon Moseley.
“The persistent wet weather and fragile consumer confidence has meant it’s been a tough start to the year for the industry, with the NIQ RSM Hospitality Business Tracker showing flat like-for-like sales, tipping some into insolvency.”
According to the Insolvency Service, there were 1,878 company insolvencies in February 2026, 7 percent up on January 2026, but 7 percent lower than February 2025.
Hospitality continues to feature in the top three UK industries with the highest number of insolvencies in the accredited official statistics, with Moseley noting the industry is “one of the hardest hit by relentless cost increases such as higher taxes, National Minimum Wage and inflation.”
“While it’s encouraging to see a drop in hospitality insolvencies year-on-year, this may be in part due to the sector shrinking overall, as the challenging trading environment makes it difficult to not only enter the market, but to compete.”
“With more headwinds to come, operators must act now to preserve cash, explore cost-cutting options, and most importantly, protect the customer experience
to keep people coming through the door.”
Batten down the hatchets
RSM Tracker said… “With more headwinds to come, operators must act now to preserve cash, explore cost-cutting options, and most importantly, protect the customer experience to keep people coming through the door…
Originally published on Coinslot on March 23, 2026. Republished with permission.