Business administrations jumped 41 percent in January, signalling mounting financial strain across retail and hospitality as rising costs continue to reshape the sector. It was a worrying turnaround as 2025 seemed to indicate a levelling out of insolvencies across the sector.
Retail and hospitality businesses across the UK are facing escalating financial pressure after company administrations rose sharply at the start of 2026. Official Insolvency Service figures show 151 businesses entered administration in January, a 41 percent rise on the previous month and 14 percent higher than a year earlier.
The surge follows a difficult 2025 for hospitality. Government data analysed in the Buchler Phillips Hospitality Index shows 3,353 accommodation and food service businesses collapsed in the year to December, only slightly down from 3,465 in 2024. Monthly insolvencies remained consistently above 220 for most of the year despite a festive dip to 204 in December.
Saxon Moseley, partner and head of leisure and hospitality at RSM UK, said operators had “held on to capitalise on festive demand ahead of the typically tougher months of trading”, but warned: “With further cost pressures, including changes to business rates, the employment rights act and the rise in national minimum wage, we expect this dip in insolvencies to be short lived.”
Rising labour costs and subdued consumer spending continue to weigh on discretionary sectors, with further business rates increases expected in April.
“There is no sign of hospitality budging from near the top of the insolvency table in the foreseeable future,” concluded Jo Milner, managing director at Buchler Phillips. “As last year’s Budget changes kick in fully, even last-minute government measures will provide little respite for the stricken sector.”
Fighting for survival
Insolvency analyst said… “There is no sign of hospitality budging from near the top of the insolvency table in the foreseeable future. As last year’s Budget changes kick in fully, even last-minute government measures will provide little respite for the stricken sector…
Originally published on Coinslot on February 23, 2026. Republished with permission.