UK Hospitality Sector Sees Slower Growth in New Openings in H1 2025

The UK hospitality sector experienced a notable deceleration in new store openings during the first half of 2025, according to data from market intelligence company Meaningful Vision. The overall rate of new openings was 1%, less than half of the 2.5% rate recorded in the same period in 2024. The pizza segment was particularly affected, showing a decline of 0.7% in shop numbers, while the burger segment maintained its previous pace of 2.6%.

Foot traffic in London declined for the first time since the post-COVID recovery, although national figures improved compared to the previous year. Northern Ireland led regional growth, followed by the South, Wales, and Scotland. Despite London's decline, overall footfall in 2025 improved from the previous year, with a decrease of 0.5% compared to a 1.2% drop in 2024. Fast food outlets contributed to this growth, with a 0.8% increase in foot traffic compared to a 0.9% decline in 2024.

Promotional activities in the restaurant sector increased significantly, with a 23% rise in offers during the first half of 2025. This follows a 25% increase in 2024, resulting in nearly 50% growth over two years. Delivery platforms saw an even more dramatic rise in promotional activity, with a 93% increase in the first half of 2025, following a 35% rise in 2024. The average discount remained stable at 25%, with loyalty app discounts averaging 31%, compared to 19% on delivery platforms.

Daypart trends also shifted, with afternoon traffic (3 to 6 pm) showing the fastest growth, while breakfast traffic slowed. Dinner traffic improved compared to the previous year, but late evening traffic continued to decline, albeit at a slower rate than in 2024. Growth in afternoon traffic was primarily driven by bakeries and coffee shops, likely influenced by commuters returning from offices.

The data highlights regional differences in growth, with Northern Ireland experiencing the highest rate of new store openings. However, like-for-like guest numbers did not increase, indicating that simply expanding the number of outlets may not be a sustainable growth strategy in a market with struggling demand. New customers were primarily attracted to new chains and independent outlets facing intense competition.

The increase in promotional activity on delivery platforms is attributed to economic pressures and intensified competition among delivery apps, making promotions a key strategy for driving volume.