For the hospitality sector, 2025 could certainly be summarised as another turbulent year. The Autumn Budget announced at the end of November saw a hike to the minimum wage and sugar tax which, added to the additional rises in operational costs and National Insurance contributions through the year, meant that further cost-cutting and reviews of operational efficiency were critical. The festive period may have provided a welcome buffer for many businesses with a flurry of visitors. But, with celebrations now in the rear-view mirror, operators have their work cut out to continue increasing footfall and revenue per head.
As we head into 2026, operators will need to become even more focused on their proposition and how they take it to the market. Many think success relies heavily on changing the menu, updating the ambience, or putting out social posts to drive growth and revenue. But more is needed. With this in mind, Patrick Clover, Founder and CEO of Stampede, predicts that success in 2026 will require technological investment, even through the difficult times. After all, in 2026 operators will face a choice: strategic spending, or potentially empty venues and declining revenues.
Cost-cutting will continue to be key
Between the Autumn Budget of 2024 and the latest one in 2025, UKHospitality projected that 111,000 jobs will have been lost in hospitality. This previous forecast was as a result of the £3.4bn of additional annual costs that the 2024 Budget thrust onto the sector. As a result, venue numbers fell at a rate of two premises per day.
2025’s rises in taxes, operational costs and National Insurance contributions have meant that hospitality businesses have had to tighten their belts to ensure that they can, at a minimum, remain profitable. This trend will likely continue throughout 2026, with rises in minimum wages again having a huge impact on the sector’s bottom line.
Moving into 2026, operators’ focus will evolve from how to survive a difficult year to how to operate sustainably in a continuously low-growth environment. Cost cutting will be key for many, but not a silver bullet solution on its own.
Tech-enabled operational efficiency
Improving operational efficiency will also form a key part of hospitality brands’ strategies in 2026. While each brand or venue’s benchmark for operational efficiency will differ – from high-volume city bars to neighbourhood pubs and boutique hotels – the ultimate sign of success is dependent on whether the efficiencies being introduced support the creation of a better experience for customers from the moment they walk through the door, and whether revenue – and profits – are growing.
Technology enables this operational efficiency and growth. Crunchtime’s UK Restaurant Growth Insights Report 2025highlighted that almost a third of operators said their technology stack improved operational efficiency and increased staff productivity – clearly showing that it’s a strategic growth driver. This operational efficiency isn’t just about finding ways to tighten processes in order to cut costs, but also about ensuring that guests’ needs are addressed and that customer service can be excellent. Increasingly, tech-enabled operational efficiency will become a widely acknowledged strategy of survival.
Restaurants, bars and hotels will become increasingly digitised
To ensure operational excellence, hospitality operators will firmly embed tech into day-to-day operations, looking to unified systems that can tackle everything from digital ordering and loyalty programs to CRM tools and payments. Throughout the year, the hospitality industry will inevitably witness strategic mergers and acquisitions, which build out these closed eco-systems that collect customer data from the discovery stage. Businesses will gain in depth customer insights and, through integrations with payment platforms, can even extract details into what customers purchased during their visits.
As disparate systems and data siloes are replaced by consolidated platforms, marketers, restaurant owners and operations teams will become more digitally savvy as they shift from just collecting data to being able to figure out how best to make use of its insights. An accurate view of the state of play will be uncovered, enabling businesses to capture, segment, market to and retain customers more effectively, according to evidence rather than instinct.
Guest engagement will drive the entire hospitality experience
This increasingly digitised mindset will mean that guest engagement will positively drive the entire hospitality experience in 2026. Operators will move on from hoping a change in menu or ambience will fix everything, to using data to drive these kinds of decisions. Through technology-enabled operational efficiency and data-led decision-making, operators will be able to attract the right clientele through doors and keep them coming back, irrespective of operational changes made.
Access to this technology and data will mean that front-of-house staff are better equipped to personalise experiences for customers and build a truly unforgettable experience. After they leave, automated marketing and loyalty offerings will make sure future visits are set in stone. Operators will be able to move on from targeting one demographic or another to really understanding what each generation values and desires. Operators will be able to evolve marketing, outreach and guest engagement to suit individuals’ needs flexibly, as and when consumer behaviour changes.
How AI will continue to reshape service
AI’s impact on hospitality is already undeniable. In 2026, operators will take the next step and focus on how AI can elevate experiences. From smarter table management and marketing, to more relevant menu recommendations, AI will analyse data and help teams spot – and act on – preferences and patterns in behaviour. Despite its significant influence, the technology fades into the background as it can enable staff to deliver a warmer, friendlier, more personalised and revenue-generating service.
Additionally, behind the scenes, AI will increasingly be used to improve staff scheduling, stock management and reporting. It will be seen as key to supporting sustainability initiatives too; by helping to track energy consumption in relation to the level of activity, and by monitoring stock, it can help reduce food waste.
Conclusion
2025 was a prolonged test of resilience under sustained pressure. The reality is this pressure is unlikely to ease as the hospitality sector takes on 2026. The strongest operators in the coming year will be the ones that stop relying on sporadic footfall and gut instinct, and instead build a strategy that centres around data and turning one-off visits into loyal relationships. Operational excellence, paired with evidence-led guest engagement, will give businesses the clarity to act with intent.
In a market this demanding, data becomes the difference between simply enduring and moving forward with direction and confidence.