Hospitality insolvencies jump 9% in January

Persistent wet weather and fragile consumer sentiment contributed to a stagnant trading environment.

Flat sales in January pushed many hospitality businesses into insolvency as persistent wet weather and fragile consumer confidence brought about a tough year for the industry, an analyst from RSM UK said.

“Most hospitality operators held on at the end of last year to capitalise on Christmas trading, before having to assess their options in January,” Saxon Mosely partner and head of leisure and hospitality at leading audit, tax and consulting firm RSM UK, said.

Recent insolvency statistics showed accommodation and food services insolvencies rose 9% month-on-month from 205 in December 2025 to 223 in January 2026. However, insolvencies in the sector dropped 18% year-on-year from 273 in January 2025.

Mosely, however, said the drop in insolvencies year-on-year may be due to the sector shrinking overall, as the challenging trading environment makes it difficult to not only to 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,” Mosely said.

Month-on-month inflation slowed to just 0.02%, according to the latest Foodservice Price Index from NIQ and Prestige Purchasing, with the market still vulnerable to micro pressures.