On the hospitality front line with Mirin’s Sharif Gergis

Edinburgh’s hospitality sector is entering one of its most turbulent periods in years, and as the foodie podcast Eating and Waiting to Eat closes its first season, host Carlos Miranda reconnects with Mirin’s Sharif Gergis to take stock of where the industry stands in 2026. From rising labour costs to shifting diner behaviour, he offers a clear-eyed view of the pressures reshaping restaurants across the city — and the opportunities that still give operators reason to stay hopeful. Over to Carlos.

We recently wrapped up the first season of our Edinburgh food podcast, Eating and Waiting to Eat.

To mark this milestone, we reconnected with one of the first guests we had on the podcast, Sharif Gergis, half of the dynamic duo behind one of Edinburgh's favourite Asian-themed restaurants: Mirin (you can listen to the episode here).

During our chat on the show, Sharif (and his partner in life and work, Elizabeth Elliot) talked in detail about the challenges facing the hospitality industry in Edinburgh specifically and in the UK more broadly. Given how much that portion of our discussion resonated with our listeners, we thought we'd check back with Sharif to hear his thoughts on the challenges, and opportunities, facing hospitality in 2026.  

It’s a hard time for hospitality. In your opinion, what are a couple of the biggest challenges facing the industry in 2026?

If I had to pick two of the biggest changes facing the industry in 2026, they would be:

1. Rising Employment Costs - The minimum wage is rising in April and employer national Insurance contributions have risen. Well-intentioned though these policies may be, they collide with the economic reality of hospitality. We are a low-margin, labour-intensive industry with little room to absorb extra costs. A small to medium-sized venue could face an additional £40,000–£80,000 in labour expenses as a direct result of these changes. When costs rise, we are left with tough choices: cut staff — something no one wants to do or, raise prices which many customers are unwilling or unable to absorb. With price increases all but inevitable, hospitality in 2026 will be highly competitive and, sadly, some businesses will not survive.

2. Changing Consumer Behaviour - People are eating out less often and spending less when they do. Health-conscious habits, lifestyle changes and the rising cost of living, means customers still want the social experience of dining out but with smaller appetites and tighter wallets. The result is a new kind of customer: health-conscious, teetotal, price-aware and selective. A salad and a glass of water may be good for wallets and waistlines but unfortunately it doesn’t pay the bills. Hospitality must adapt without losing its identity.

What are possible solutions to the challenges you’ve highlighted? What can the government be doing at the policy level?

1. Across Europe, many countries apply reduced VAT rates to hospitality — often around 10%, though the exact rate varies. France, Spain and Italy all use a 10% reduced rate for parts of the sector, while Ireland applies a 9% reduced rate. By contrast, the UK’s standard 20% VAT rate remains significantly higher, making the sector less competitive in relative terms.

Lower VAT could help make dining out more affordable, thereby increasing demand. The challenge is of course that hospitality VAT generates significant amounts of revenue for the Treasury so any cut would need to be carefully balanced with wider fiscal considerations. Targeted corporation tax reform could offer a complementary approach. A reduced rate on the first tranche of profits — for example, 5% on profits up to £50,000, might help the small, low-margin businesses to retain cash, to invest in staff and to weather slow periods. Together, a carefully calibrated VAT reduction and profit-based support could provide immediate relief for the sector while maintaining fiscal responsibility.

2. National Insurance Contributions (NICs) -  National Insurance is, in effect, a tax on jobs. Reducing NICs helps to protect employment, retain skilled staff and of course strengthens the wider economy. The government cannot claim to pursue economic growth while actively discouraging it through higher labour costs.

3. Business Rates -  Business rates should reflect profitability rather than outdated property valuations, a problem particularly acute in cities like Edinburgh. Reform here could provide much-needed relief for small and medium-size operators.

4. Labour and Migration - Post-Brexit staff shortages mean sector-specific visa routes, support for training and apprenticeships, and incentives for long-term staff retention are essential

5. Hospitality as Infrastructure - Pubs, cafés and restaurants are not just businesses. They are cultural and economic infrastructure. They are central to tourism, city life and employment. Recognising this in policy decisions and ensuring they are part of high-street regeneration, is crucial to sustaining vibrant communities.

Ending on a positive - what opportunities are you excited by in 2026? Both for Mirin specifically and for the hospitality industry as a whole?

For Mirin, that means pushing boundaries in flavour, service and atmosphere. We will continue to seek out the most delicious and interesting produce from our incredible network of farmers, gamekeepers, fish merchants, foragers, shopkeepers, brewers and wine suppliers. We will continue to support our team and community, and despite the challenging environment, we hope to open more restaurants — with one, hopefully opening, this side of summer.

Edinburgh’s hospitality scene is resilient. The people who run it are passionate, skilled, hardworking, and creative. The city remains home to more than its fair share of “bon vivants.” At its heart, the future of hospitality rests on what it has always done best; bringing people together, celebrating life and creating opportunities to enjoy quality time with friends and loved ones. As long as that spirit endures, Edinburgh’s hospitality will not only survive the challenges ahead but continue to define the city’s energy, character and charm.

You can listen (and subscribe) to Eating and Waiting to Eat here and follow them on Instagram here. 

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