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How understanding your customers can help your restaurant thrive in 2026
Local spending is where loyalty lies for operators
Running a restaurant has never been simple. But right now, local hospitality businesses across the UK are navigating something particularly complex: customers who genuinely want to support them, and yet are watching every penny at the same time.
The good news is that the data tells a more optimistic story than the headlines might suggest. Square’s 2026 Local Economy Report reveals that local spending isn’t just holding up, it’s deepening. And for restaurants that understand what’s driving that loyalty, there’s a real opportunity to grow.
Key takeaways
- Quality is the top factor in choosing where to eat, but nearly a third of diners are also looking for something unique or personalised
- 80% of UK consumers say their relationship with their favourite local business is much more than transactional, it’s familiar, connected, even essential
- 77% of customers want to hear from local businesses. Email is the most preferred channel, making a simple regular cadence one of the most effective things you can do
- 93% of sellers using a marketing product successfully maintain a base of regulars, compared to 39% who don’t
- Square brings loyalty, email marketing and reporting together in one place, so the everyday habits that build regulars are easier to maintain
Customers are spending locally, and they plan to keep doing it
One of the most striking findings in Square’s report is how committed UK consumers are to spending locally, even under real financial pressure. In the last 12 months, a third of UK consumers did more than half of their shopping and dining with local businesses. One in five bought locally several times a week.
Looking ahead, more than a quarter of UK consumers say they plan to shop or dine locally more often in the next 12 months. A further 61% expect to keep their local spending at the same level. Quality is the top factor in choosing where to eat, cited by 73% of respondents. Price and convenience follow, but they’re not the whole story. Nearly a third of consumers are actively looking for something unique or personalised. And 80% say their relationship with their favourite local business is much more than transactional – it’s familiar, connected, even essential.
That’s where Square’s reporting tools come in. They help you see which parts of your business are landing so you can start doing more of it.
What turns a first visit into a regular relationship
Understanding why customers come back is one thing. Building the systems to make it happen consistently is another.
Square’s data highlights something important here: restaurants that invest in marketing tools don’t just reach more people – they hold onto them. Among UK sellers using a marketing product, 93% successfully maintain a base of regular customers. Among those who don’t, that figure drops to 39%.
That gap is significant. And it reflects something broader: customers want to hear from the local businesses they love. In Square’s survey, 77% of UK consumers said they want to communicate with local businesses. Email is the most preferred channel, with social content and direct messages playing a supporting role. For restaurants, this is an open invitation to stay front of mind between visits – sharing what’s new on the menu, announcing seasonal specials, or simply reminding regulars that they’re valued. It’s why Square’s marketing tools make it straightforward to build that cadence without it becoming another thing on an already long to-do list.
How Square brings it together
Square’s integrated platform connects the tools that build regulars – marketing, loyalty programmes, payments and reporting – so they work together rather than in isolation.
Square AI sits across all of it, helping you understand which campaigns are driving visits, which dishes are performing and where to focus next. Instead of piecing together data from different sources, you get a clear picture of what’s working and what to do about it.
Building for the year ahead
Square’s report is clear on what thriving in 2026 looks like for local hospitality: consistent quality, human connection, clear value, and the digital conveniences that make it easy for customers to come back. Not a single big bet, but a set of everyday habits that compound over time.
That’s where the right tools make a genuine difference – not by changing what makes a restaurant special, but by making it easier to deliver that experience reliably. From understanding which dishes are driving spend to running a loyalty programme that actually works.
The customers are there. They want to come back. The question is whether the systems are in place to make that as easy as possible – for them, and for the teams serving them.
Download the Square Local Economy report to learn more or schedule a demo with the Square Sales team today!
Squareup Europe Ltd is authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011 (registered reference no. 900846).
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