Branded bakery-led formats are driving the strongest growth in the UK sandwich and bakery market, according to the latest Operator Data Index report from Lumina Intelligence.
The Q2 2026 report forecast that the UK sandwich and bakery market will grow by 2.6% to £7.4bn this year, with a modest 0.9% growth in outlets to 15,932. Within this, branded bakery-led formats are driving the strongest growth with an expected 4% increase in total turnover to £3.5bn.
Independent bakeries and sandwich retailers are also expected to contribute to the growth, with a 1.3% growth to £1.7bn and 1.9% growth to £1bn forecast, respectively.
Branded sandwich retailers are the only sub sector forecast to contract, with a decline anticipated in turnover and number of outlets during 2026. This, according to Lumina Intelligence, reflects continued estate rationalisation, with underperforming sites exiting faster than sales can be replaced through like-for-like improvements.
Subway appears to be contributing significantly to this with a decline seen in the number of outlets it operates over the past few years from 2,132 in 2024 to a predicted 2,040 in 2026 – a 4.3% decrease.
Like bakeries, coffee shops and cafes are also performing well with a 3.1% increase forecast for 2026 and growth seen across both branded and independent offerings. For branded operators, growth is set to come from “selective estate growth”, according to Lumina, with revenue growth driven by “incremental network expansion and sustained spend per visit, rather than aggressive rollout”.
Outlet numbers are expected to grow fast when it comes to independent coffee shops and cafes which Lumina says “suggests continued consumer support for neighbourhood-led formats, with growth underpinned by modest estate expansion rather than material pricing-led escalation”.
There’s been a shift in the type of locations coffee and food-to-go operators are targeting, increasingly partnering with forecourt and leisure businesses to access high-footfall locations, extend their reach beyond traditional high streets, and capture demand around travel and entertainment occasions. For example, Greggs launched its first Greggs Express unit – a compact, self-service format – with Motor Fuel Group at a location near Glasgow Airport. Costa Coffee, meanwhile, has agreed to a 10-year partnership with Cineworld to open stores in up to 26 UK cinemas.
The fastest growing coffee and sandwich brands remain concentrated among smaller, premium concepts in 2026, at least as far as percentage outlet growth is concerned.
As expected, there’s a lot of cross over between companies featuring in the top 10 for outlet growth and turnover growth by percentage with seven of the firms appearing on both lists (Urban Baristas, B Bagel, Benugo, Snowflake, Amorino, Blank Street, and Esquires). However, a strong financial performance from Gail’s, Joe & The Juice, and Auntie Anne’s see them make the latter top 10 list.
Indeed, Joe & The Juice’s success has seen it leapfrog Krispy Kreme to become the ninth biggest coffee and sandwich brand by turnover overall. It unveiled plans to continue UK estate expansion this year, having opened 16 new shops in 2025.
No comments yet