Catering in 2026: demand remains, but margins are under pressure

The UK catering and food-service sector remains an important and active market in 2026, but growth is being shaped as much by costs and staffing as by customer demand.

The latest ONS data shows accommodation and food-service activity edged up in June and July 2026, following a weaker start to the year.

At the same time, businesses in the sector are facing some of the highest cost pressures in the economy.

What is driving demand in catering?

Customers still want convenience, choice and flexibility.

Online ordering, takeaway, delivery and event catering are now established parts of the market rather than new trends.

For many operators, the opportunity is no longer simply to offer food through more channels, but to work out which channels are actually profitable.

A strong catering business in 2026 may combine:

• in-house dining or takeaway;
• delivery;
• corporate catering;
• weddings and private events;
• repeat contracts; and
• online ordering.

Diversifying revenue can help, provided each part of the business is commercially sustainable.

What are the biggest challenges in 2026?

Energy, labour and ingredient costs remain significant.

In October 2026, ONS data showed that 91% of accommodation and food-service businesses were concerned about energy prices, the highest proportion of any sector.

Earlier in the year, half of businesses in the sector said the cost of materials was affecting turnover, while 50% also cited labour costs.

That puts pressure on margins, particularly for smaller operators that have less buying power and limited room to increase prices.

Staffing remains important

Catering is still a labour-intensive industry.

Although overall UK vacancies have fallen, accommodation and food service continued to have one of the highest vacancy rates in summer 2026, at 2.8%.

For buyers and owners, that makes staff retention, training and management depth particularly important.

A business that depends too heavily on one chef, manager or owner can be harder to transfer successfully.

What makes a catering business attractive to buyers?

Buyers tend to look beyond turnover and focus on how dependable the business really is.

They are likely to consider:

• repeat and contracted revenue;
• gross and net margins;
• food and labour costs;
• customer concentration;
• online reviews and local reputation;
• staff retention;
• premises and lease terms;
• licences and compliance;
• delivery-platform dependence; and
• how involved the owner is day to day.

A catering business with strong repeat demand, good systems and a capable team can be far more attractive than one with higher sales but unpredictable margins.

Is catering still a good sector to be in?

For well-run businesses, catering can still be an attractive sector in 2026.

Demand remains broad across eating out, takeaway, delivery, corporate catering and private events, but the strongest operators are those that combine good customer demand with disciplined cost control.

That means buyers are likely to favour businesses with repeat or contracted income, healthy margins, a strong local reputation, reliable staff, well-managed premises and limited dependence on the owner.

The sector is not without challenges, particularly around labour, energy and food costs, but businesses that manage those pressures well can still offer a compelling opportunity.

Thinking about buying or selling a catering business?

If you are considering buying or selling in the sector, it is worth looking beyond headline turnover and understanding how the business performs after labour, food, energy and delivery costs are taken into account.

At Intelligent, we market food and catering businesses across the UK and can also provide a free, confidential business valuation for owners considering a sale.

No jargon. No pressure to sell. Just clear, useful advice.

If you want to start cooking with gas, check out the catering and hospitality businesses we have for sale nationwide.