How to Increase Restaurant Profitability in 2026

Key Takeaways

• UK restaurant, pub, and hotel margins face sustained pressure from declining revenue, rising labour costs, and higher energy prices.
• Manual invoice processing and delayed financial reporting limit visibility, which makes it hard to react to supplier price changes in time.
• Kitchen automation replaces slow spreadsheets with live costing, real-time alerts, and integrated sales data so teams can protect dish and menu margins.
• Restaurants that adopt automated back-of-house systems save significant admin time and can improve gross profit by several percentage points.
• Jelly gives UK hospitality teams a simple way to automate invoices, costing, and menu profitability. Book a chat with Jelly to see how it works in your kitchen.

Why UK Restaurant Profit Margins Are Shrinking in 2026

UK hospitality operates in a difficult financial environment. Industry revenue is expected to decline at a CAGR of 6.4% through 2026, while average profit margins settled at 9.8% in 2024, lower than previous years.

Operating costs continue to climb.

• Labour costs have risen by about 40% since April 2020, with the National Living Wage now at £12.21 per hour.
• Energy bills have roughly doubled since 2022, which hits full-service restaurants hardest.
• Food inflation and supply volatility add extra risk to already thin margins.

Manual management increases the pressure. Many owners and finance managers rely on month-end accountant reports, which arrive long after price changes have started to erode margins. Executive chefs often cost dishes in spreadsheets, where a single menu item can take close to half an hour to build accurately.

This approach has clear consequences.

• Teams lose 10 to 20 hours every week on data entry, price checking, and invoice reconciliation.
• Leaders lack real-time visibility of dish and menu performance.
• Decisions become reactive instead of planned.

The impact on growth is visible across the sector. In 2024, 21% of UK pubs reported negative net assets, which shows how quickly margin pressure can develop into financial distress, especially once a business expands beyond a single site.

How Kitchen Automation Increases Restaurant Profitability

Kitchen automation replaces slow, manual work with accurate, real-time data. Automated systems capture invoice details as they arrive, track ingredient prices, and link costs to sales so that leaders can see the true margin on every dish and menu.

This shift moves the business from hindsight to live insight. Teams can spot cost issues early, negotiate with suppliers using hard data, and adjust recipes or prices before losses build up.

Jelly gives growing restaurants, pubs, and boutique hotels a focused way to automate back-of-house operations. The platform suits UK sites with annual revenues above £500,000 that need control without complex enterprise software.

• Reduces manual admin by 10 to 20 hours each month.
• Shows real-time ingredient costs and dish profitability.
• Supports supplier negotiations with detailed price change history.
• Automates invoice processing and links directly to accounting tools.
• Improves gross profit margins by an average of 2 percentage points within the first 3 months.

See how Jelly automates your kitchen management and book a chat.

How Jelly Solves Common Profit Killers

Faster Invoice Processing and Clearer Daily Numbers

Manual invoice handling slows down financial decisions. Teams enter line items by hand, cross-check prices, and reconcile supplier statements, which delays meaningful reporting until month end.

Jelly replaces this with automated data capture. Invoices arrive by photo or email, and the system reads each line, including quantity, SKU, price, and tax. This process removes most data entry and reduces bookkeeping time.

Daily Flash Reports, Price Alerts, and Sales Mix reports give up-to-date views of gross profit and kitchen performance by connecting Jelly to POS data. Owners no longer need to wait for the accountant to understand yesterday’s results.

Live Dish Costing and Ingredient Price Alerts

Untracked ingredient price changes can turn a strong seller into a loss without anyone noticing. Spreadsheet-based costing rarely keeps up, especially across multiple suppliers and SKUs.

Jelly centralises recipes in the Kitchen section. Chefs select ingredients that already exist in the system from scanned invoices, and Jelly handles conversions and costing automatically. A job that once took 28 minutes per dish now takes only a few minutes.

Price Alerts highlight every supplier increase or decrease. Ingredient cost changes flow through into live dish costs and gross profit percentages. A simple red or green indicator shows whether a dish margin has dropped or improved, which makes it easier to decide whether to reprice, adjust the recipe, or challenge a supplier.

Menu Engineering With Linked Sales and Cost Data

Many menus evolve from habit and intuition, not from data. Without linking sales volume to profitability, teams might promote popular but low-margin dishes while ignoring quieter high-margin items.

Jelly connects to POS systems such as ePOSnow and combines sales mix with cost data. Menu Engineering reports show which dishes are both popular and profitable, which are high-margin but under promoted, and which drain margin despite strong sales.

Delivery operations also become easier to manage. Jelly supports building delivery menus that factor in commission fees and other overheads so that online orders add to profit instead of eroding it.

Why Automation Beats Spreadsheets and Legacy Systems

Jelly focuses on automation, clear reporting, and straightforward onboarding. Many kitchens see useful insights within the first week of use.

Book a chat to compare Jelly with your current setup.

Results UK Restaurants Achieve With Jelly

Jelly already supports restaurants, pubs, and hotels across the UK, which gives a clear view of the results automation can deliver.

Claudio from the Illuminati Group described previous workflows as piles of paperwork and endless data entry. After switching to Jelly, administrative work reduced enough for the team to refocus on service and food quality.

Stuart Noble, Head Chef at Cairn Lodge Hotel, saw food costs fall by about 5% in a month once every dish had live, accurate costings at his fingertips.

At Amber, a Mediterranean restaurant in East London run by Chef-Owner Murat Kilic, manual invoice work and volatile prices once made it hard to protect margins. After introducing Jelly’s invoice automation, price alerts, and real-time costing, Amber saved around £3,000 to £4,000 per month, which equated to roughly 68 times return on investment. Faster visibility of price changes supported firmer supplier negotiations and quicker menu decisions. Murat summed up the impact simply: “Jelly keeps my business alive.”

What To Expect When You Automate Your Kitchen

Impact on Profit Margins

Most Jelly customers see gross profit improve by about 2 percentage points within 3 months. Gains usually come from lower admin time, tighter control of ingredient costs, fewer pricing errors, and better menu decisions.

Day-to-Day Use for Kitchen Teams

Jelly is built for busy chefs rather than accountants or analysts. The interface focuses on clear recipes, live costs, and simple alerts so that even less tech-confident team members can use it after a brief introduction.

Maintaining Profitability Despite Rising Costs

Automation does not remove external pressure from labour, energy, or food prices, but it does improve control over how the business responds. Real-time visibility allows quicker menu changes, portion adjustments, and supplier negotiations, which helps maintain or improve margins even as costs shift.

Speed of Results

Most sites start to receive Flash Reports, Price Alerts, and spend insights in the first week, often within 24 hours of uploading initial invoices. The ability to act on this information arrives almost immediately.

Benefits Beyond Better Spreadsheets

Automated systems capture every invoice automatically, update all linked recipes, and refresh reports without extra work from the team. Manual spreadsheets cannot match this speed or scalability, especially once a business grows to multiple sites or complex menus.

Conclusion: Strengthen Restaurant Profitability With Automation in 2026

UK restaurants, pubs, and boutique hotels face rising costs and intense competition in 2026. Manual back-of-house processes make it difficult to see where money is lost, which slows decisions and reduces resilience.

Jelly offers a practical way to regain control. Automation of invoices, live costing, and menu analysis gives leaders the information needed to protect margins and plan for growth, without adding extra admin to already stretched teams.

Restaurants using Jelly regularly report time savings of 10 to 20 hours a month and measurable improvements in gross profit. These gains can represent the difference between surviving and building a stronger, more profitable hospitality business.

Start protecting your restaurant margins with Jelly and book a chat.