From Eat the Bird to Neat Burger: Why UK restaurants are closing and how digital innovation can save them

It’s been a bruising year for the UK restaurant business and 2025 isn’t letting up. Fresh credit risk data shows that one in five of Britain’s 50,900 eateries now has negative net assets, putting them technically in the red. Bankruptcies are up 50% on last year, with 17 major chains going under compared to nine in 2023.

And the bad news kept coming on 22 July 2025, when two well-loved chains went bust on the very same morning. According to The Scottish Sun, one of the biggest shocks was Eat the Bird, the award-winning burger joint that bagged “Street Food Dish of the Year” in 2023, only to shut its doors just two years later.

Adding to the irony, only days before, YouTube vlogger Danny from Rate My Takeaway had sung its praises in a video that’s been watched more than 95,000 times. But behind the scenes, unpaid suppliers, missed staff wages, and mounting debts told a very different story.

The same day, Neat Burger, backed by Lewis Hamilton and Leonardo DiCaprio, also folded. Losses had ballooned from £3.2 million in 2021 to £7.9 million in 2022. Together, these closures show that in today’s UK hospitality market, not even celebrity backing or top-notch grub can guarantee survival.

Why UK restaurants are closing in 2025: From celebrity chains to local favourites

The fall of Eat the Bird is more than just the end of a burger joint, it’s a snapshot of the pressures facing restaurants across Britain. Founded in 2017 in Taunton, it built a loyal following and, by 2022, had expanded to Exeter and Cardiff. Awards rolled in, customers raved, but behind the scenes, co-owner Daniel Aldridge spoke of lingering “post-COVID difficulties” and rising costs that the business simply couldn’t outrun.

And Eat the Bird is far from alone. Even global brands are feeling the squeeze. Papa John’s UK shut 74 branches in 2024, reporting pre-tax losses of £21.8 million, down from £102.3 million in sales in 2021 to £88.6 million last year. High operating costs, staff shortages, and falling customer demand all played their part.

Margins in hospitality have always been slim, typically just 3 to 5%. That’s why April 2025’s budget changes hit so hard. Increases in Employers’ National Insurance alone added £2,000 to £3,500 per full-time employee per year, while business rates rose an average of 6.7% in major UK cities. In London, some saw hikes of more than £8,000 annually. For a small 20-seat restaurant with eight staff, that’s an extra £25,000 to £30,000 a year, the equivalent of serving another 8,000 to 10,000 covers just to break even.

The post-pandemic recovery hasn’t been smooth, either. Restaurants are still wrestling with supply chain delays, repaying government support loans, and adapting to a very different customer base. Today, almost 90% of diners research restaurants on their phones before deciding where to eat. Yet many restaurants are clinging to outdated digital strategies, leaving them invisible to potential customers.

And it’s not just about being online, it’s about being present. With 72% of people checking social media before dining out and 74% using it to choose where to eat, failing to keep up with digital trends is now a survival issue. Many businesses are still running the same systems they installed in 2008–2009, missing the chance to modernise their service and marketing.

Caught between high-end experiential dining and cheap fast-food chains, mid-market restaurants are being squeezed from both sides. Without a shift in strategy, especially online, the closures we’ve seen so far may just be the beginning.

How digital transformation can save UK restaurants in 2025

In 2025, the restaurants bucking the closure trend have one thing in common, they treat digital transformation as essential infrastructure, not a nice-to-have. Social media has moved far beyond sharing pretty food snaps. It’s now the second most popular way people discover restaurants, right after Google search.

The most successful operators know that today’s diners value authenticity over gloss. Rather than polished ad campaigns, they share real, behind-the-scenes moments, the kitchen buzz before service, a chef plating their favourite dish, staff celebrating a customer’s birthday. On TikTok and Instagram Reels, this kind of short-form, “in the moment” content consistently outperforms traditional advertising.

AI is also changing the game. Personalisation tools can now segment customers based on preferences and order history, allowing restaurants to send targeted offers that feel relevant rather than spammy.

And it’s not just about broadcasting, it’s about building community. Restaurants that engage meaningfully on social media are turning casual diners into brand advocates. Twenty-two percent of customers say a restaurant’s social presence influences them to return. Smaller, local influencers often deliver better results than big-name personalities, as their recommendations feel more genuine to neighbourhood audiences.

The website is now a critical piece of the puzzle. Gone are the days when a static page with a PDF menu would do. Modern sites double as eCommerce platforms, integrating online ordering, payment processing, and customer engagement tools. WooCommerce payment plugins allow restaurants to take payments directly on their site, while modern payment APIs connect seamlessly with POS systems, inventory, and accounting software.

Speed and usability are everything. Fast-loading pages, single-click checkout, and instant banking options can reduce the industry’s average 70% cart abandonment rate to under 1%, turning browsers into paying customers.

The payment revolution is helping UK restaurants cut costs in 2025

For restaurants running on razor-thin margins, payment processing fees can quietly eat into profits. The open banking revolution is changing that by giving hospitality businesses faster, cheaper, and smarter ways to take payments.

In the UK, API calls for open banking surged past 100 billion in 2023 and are forecast to hit 580 billion by 2027. That growth is driven by one simple fact: traditional card payments cost restaurants money. Fees typically range from 1.4% to 2.5% per transaction, plus hidden charges. For a busy venue, that adds up to thousands of pounds a year.

By contrast, open banking providers such as Wonderful offer instant bank payments for just 1p per transaction, saving restaurants 90% or more in processing costs. And the benefits go beyond savings. Seventy-seven percent of UK SMEs say real-time payment services give them clearer, more up-to-date cash flow visibility. That’s vital for making smarter decisions on stock, staffing, and suppliers, the kind of choices that could have helped prevent failures like Eat the Bird’s unpaid supplier crisis.

Technology is also reshaping the payment experience itself. Mobile POS systems (mPOS) are expected to serve 1.94 billion users by 2027, handling $5.58 trillion in transactions. They allow tableside payments, outdoor dining, and off-site catering, revenue opportunities that old fixed terminals can’t support.

Contactless payments are evolving too. By 2025, 30% of UK smartphone owners are expected to use QR codes for payments. This not only meets customer demand for clean, quick transactions but also reduces the staffing required to handle payments. Wonderful’s One App lets diners pay directly from their bank account to the restaurant’s bank account, securely, instantly, and without the faff of entering card details.

It’s a crowded market, but each solution has its strengths.

• Open banking specialists like Wonderful and GoCardless focus on instant bank payments and cost savings.
• Integrated mPOS platforms such as SumUp and Square combine mobile hardware with full POS software.
• Global payment processors such as PayPal and Stripe have strong infrastructure for online orders and delivery.
• Hospitality-focused providers such as OrderPay and Elavon offer industry-specific features and integrations.

For restaurants looking to protect profits in 2025, choosing the right mix of payment tools isn’t just a back-office decision, it’s a survival strategy.

New revenue streams for UK restaurants in 2025: Beyond the dining room

With traditional dining margins under pressure, smart UK restaurateurs are finding fresh ways to boost revenue, using the resources, skills, and community connections they already have.

1. The cloud kitchen revolution

The European cloud kitchen market is booming, set to grow from £6.21 billion in 2025 to £20.98 billion by 2032, a 19% annual growth rate. Europe holds 20.2% of the global market, and the UK is leading the charge.

Deliveroo’s “Editions” ghost kitchens, launched in 2017, are now common, with 67% of available kitchen space in London running under this delivery-focused model. The payoff? Ghost kitchens often achieve profit margins of 10% to 30%, averaging 15%, far better than the 3% to 5% typical in traditional restaurants.

By 2o25, 30% of cloud kitchens are expected to use AI-driven, plate-specific menus, and 25% will integrate robotic tech to cut labour costs, changes already paying off for forward-thinking operators.

2. Transforming corporate catering

Hybrid work has created a golden opportunity for B2B catering. Instead of huge events, companies are now ordering for frequent, smaller gatherings. A single corporate lunch can generate the same revenue as 10 to 15 individual covers, with higher margins and guaranteed payment terms.

3. Expanding retail offerings

Signature sauces, spice mixes, and meal kits allow customers to recreate favourite dishes at home, turning restaurant favourites into retail products and creating passive income streams.

4. Renting out kitchen space

Off-peak hours can be monetised by renting kitchen space to food start-ups, caterers, or even cooking hobbyists. This makes better use of fixed assets while supporting local food entrepreneurs.

5. Subscription and loyalty programmes

Weekly meal plans, coffee subscriptions, and priority booking perks can lock in repeat business while generating predictable monthly income.

6. Hosting events and experiences

Cooking classes, wine tastings, or private hire events during quiet periods not only bring in extra revenue but also strengthen community ties, making customers more loyal and more willing to pay a premium.

The tech stack that works for UK restaurants in 2025

Digital transformation doesn’t have to mean buying every shiny new gadget in the market. The most successful restaurants in 2025 follow one golden rule: start modestly, expand wisely.

The priority order is clear: 

1. Payments: because improving cash flow is the fastest way to stay afloat.
2. Customer engagement: to keep diners coming back.
3. Operational automation: to save time and reduce costs once the basics are in place.

A practical 30 to 60 to 90 day plan

Days 1 to 30:

• Audit your payment system.
• Switch to modern banking solutions that cut card processing fees and speed up settlements.

Days 31 to 60:

• Roll out tableside payment and direct ordering systems for smoother service.
• Make it easy for customers to pay however they want, without waiting for the card machine.

Days 61 to 90:

• Automate your social media posts
• Start collecting customer data and set up basic analytics for targeted offers.

Integration done right

Many tech projects fail because restaurants try to connect too many systems too quickly. The winning formula? 

• Payment processing
• Point-of-sale
• Customer management

Everything else can wait until these three pillars are solid.

ROI benchmarks you should see

• 60% to 90% drop in payment processing costs within the first month.
• 25% faster order processing thanks to more flexible payment options.
• 15% of revenue coming from direct online orders within 90 days.
• Personalised marketing campaigns reaching 40% of your customer base.

Beyond survival: Building antifragile restaurants in 2025

Some restaurant owners are just trying to survive 2025. The smartest ones? They’re building antifragile operations, businesses that don’t just withstand uncertainty, but get stronger because of it.

These operators combine diverse revenue streams, flexible cost structures, and scalable technology that grows or shrinks with demand. This means no over-investment in fixed assets and no scrambling when the market shifts.

The resilient revenue mix

The UK restaurants thriving this year tend to share a similar split:

• 40% dine-in
• 35% delivery/takeaway
• 15% retail/catering
• 10% experiences/events

This mix spreads risk across multiple income sources and ensures your kitchen, staff, and premises are working for you all week, not just during peak service.

The 48-hour pivot

With the right payment and e-commerce setup, restaurants can launch a new revenue stream in just two days. Whether it’s selling branded sauces online, offering a weekend cooking class, or starting a pop-up delivery menu, modern banking and ordering systems make it quick and low-risk.

This agility can mean the difference between steady growth and a slow decline like Eat the Bird’s, where delays in adapting left the business exposed.

Efficiency as a competitive weapon

Well-run restaurants in 2025 are achieving 8% to 12% profit margins by:

• Eliminating traditional card fees with open banking
• Streamlining admin and payroll
• Automating parts of ordering and marketing

These efficiency gains aren’t just cost savings, they’re a lasting competitive advantage.

The local network effect

Resilient restaurants don’t operate in isolation. They:

• Partner with nearby retailers for cross-promotions
• Share customer traffic with local coffee shops, gyms, and markets
• Join delivery cooperatives to cut costs and increase reach

When times get tough, these networks keep customers and cash flow moving.

The path forward: Act now or join the statistics 

The UK restaurant industry is at a crossroads. On one side are the casualties, like Eat the Bird, much-loved, award-winning names that couldn’t survive outdated systems and rising costs. On the other hand are the innovators, using digital transformation, modern payment solutions, and diversified revenue streams to thrive in a challenging market.

Here’s the reality: with traditional card fees, cash flow delays, and inefficient operations, restaurants running on 3% to 5% margins are only ever one bad month away from closure. But, by upgrading to open banking, integrated ordering systems, and multi-channel income models, operators can achieve 8% to 12% profit margins, even in 2025’s competitive climate.

And with the April 2025 budget changes adding more pressure on payroll and supplier costs, the gap between winners and losers will widen fast. Those who act now will come out stronger. Those who delay may soon be reading about themselves in the business pages.

The technology exists. The path is clear. What matters is whether you take the first step today. Because in 2025, standing still is the same as falling behind.

FAQ

Why did Eat the Bird and Neat Burger close?

Both chains closed due to heavy debts, falling sales, and high costs. Eat the Bird faced unpaid wages and supplier bills; Neat Burger’s losses grew as footfall and delivery demand fell.

How bad is the UK restaurant closure rate?

Restaurant closures in the UK hit record highs in 2024–25, with a 19% rise year-on-year. High costs, reduced spending, and post-COVID shifts are driving many operators out of business.

How can restaurants avoid financial trouble?

Cut payment fees with modern systems, diversify revenue beyond dine-in, and use digital tools for marketing and operations. Resilient operators adopt tech before crises hit.

Can celebrity-backed restaurants fail?

Yes. Neat Burger, backed by Lewis Hamilton and Leonardo DiCaprio, collapsed despite big funding. Celebrity support can’t offset sustained losses and market shifts.

How fast can restaurants add new income streams?

With the right payment and eCommerce tools, restaurants can launch delivery, retail, or events in as little as 48 hours, creating agile, crisis-proof revenue.

What is the biggest cost for UK restaurants?

Labour, rent, and food are top expenses. Payment processing fees can also erode margins by 3–5%, making cost control crucial for survival.

Is delivery still profitable for UK restaurants?

Yes, but only with the right model. Ghost kitchens and direct ordering can raise margins to 15%, compared to 3–5% for traditional dine-in.

What is a ghost kitchen?

A delivery-only kitchen that saves on rent and staff. In London, 67% of available kitchen space now uses this model to meet delivery demand.

How can restaurants improve cash flow quickly?

Switch to modern payment systems like Wonderful that cut fees and speed up settlements. This can boost cash flow by 60 to 90% in the first month.

Why is digital transformation critical now?

With closures rising, adopting tech for payments, marketing, and operations is the fastest way to cut costs, attract customers, and stay competitive.