Other Restaurants Industry Terminology

A/B Testing

A method of controlled experimentation where two variants (A and B) of an element (menu item name, photo, price, CTA, offer) are shown to different audiences to determine which yields better results.

“We A/B tested two hero images for our online menu and the burger photo lifted conversion by 8%.” “Run an A/B test on the $12.99 vs $13.49 price to see impact on takeout orders.”


ADA Compliance

Conformance with the Americans with Disabilities Act, covering accessible physical spaces (ramps, widths, restrooms) and digital experiences (contrast, alt text, keyboard navigation) for guests and employees.

“Our website’s menu PDF needs alt text to meet ADA guidelines.” “Ensure the new patio layout maintains ADA-compliant aisle widths and ramp access.”


Average Check

The average revenue per guest or order, typically calculated as total sales divided by number of checks or guests; a key pricing, upsell, and menu-engineering KPI.

“Our average check rose from $18.40 to $20.10 after adding add-on sides.” “Catering’s average check is 4x higher than dine-in.”


Back-of-House (BOH)

The non-guest-facing areas and operations (kitchen, prep, dish, storage) that produce food and support service.

“BOH is understaffed tonight—shift a runner to help sauté.” “Move the sauce station to reduce BOH congestion.”


Beverage Cost Percentage

Beverage COGS divided by beverage sales, indicating profitability of drinks; managed via pricing, portion control, vendor terms, and wastage minimization.

“Draft beer cost is 22%, cocktails are at 28%—we need tighter pours.” “Raising wine pricing lowered bev cost percentage by 2 points.”


Break-even Point

The sales level at which total revenue equals total fixed and variable costs; beyond this, the operation becomes profitable.

“We break even at $7,800/day; rainy days below $6k put us in the red.” “The new kiosk reduces labor, lowering our break-even.”


CAC (Customer Acquisition Cost)

The total marketing and sales cost required to acquire one new customer or first order; used to evaluate channel efficiency and payback windows.

“Our CAC on paid social is $6.30 per app download.” “Partnership flyers cut CAC vs digital ads in this trade area.”


COGS (Cost of Goods Sold)

Direct costs of ingredients and disposables used to produce items sold; typically excludes labor and overhead.

“COGS spiked after the chicken tender market jumped.” “Tighter portioning brought COGS back under 30%.”


Comp

Two common uses: 1) Complimentary item given to a guest to resolve service issues or as goodwill. 2) Comparable (same-store) sales performance versus a prior period (“comps”).

“Comp the guest a dessert for the long wait.” “Q2 comps were +5.4% year over year at company-owned stores.”


Cross-Utilization

Designing menus and prep so ingredients serve multiple items, boosting efficiency, lowering inventory, and reducing spoilage.

“Use roast cauliflower both in bowls and tacos for cross-utilization.” “Cross-utilization reduced SKUs and waste by 12%.”


Curbside Pickup

An off-premise service where guests receive orders at their vehicle without entering the restaurant; often coordinated via app and geolocation.

“Add geofencing so curbside orders fire when guests arrive.” “Train staff on car-side handoff and two-minute curbside SLA.”


Delivery Aggregator

Third-party marketplace and logistics platforms that provide ordering, discovery, and delivery (e.g., 3PD marketplaces) in exchange for commissions and fees.

“We’ll launch with two aggregators to test coverage and fees.” “Consolidate aggregator tablets into the POS to stop order misses.”


Delivery Radius

The geographic boundary within which delivery is offered; balances demand capture with promised ETAs, driver availability, and food integrity.

“Shrink our radius during peak to preserve food quality.” “Extend the radius on slow days to lift order volume.”


Dine-in Mix

The proportion of total orders or sales that occur on-premise versus takeout/delivery; used for staffing and inventory planning.

“Our dine-in mix is back to 55%, easing packaging costs.” “Weather swings our dine-in mix by 10 points on weekends.”


Dynamic Pricing

Adjusting menu prices by channel, time, or demand to optimize margins and capacity; requires careful guest communication and brand alignment.

“Pilot dynamic pricing on delivery-only items during peak.” “Late-night surge pricing improved margins but watch guest sentiment.”


EBITDA

Earnings Before Interest, Taxes, Depreciation, and Amortization; a common measure of operating performance and cash generation.

“We target 15% EBITDA after the remodel.” “Aggregator fees are compressing EBITDA by ~200 bps.”


Expediter (Expo)

The person or station coordinating completed items at the pass, ensuring order accuracy, timing, plating, and communication between BOH and FOH.

“Expo is calling tickets too fast for grill.” “Assign the strongest communicator to expo on Friday nights.”


FIFO (First In, First Out)

An inventory rotation method where older stock is used before newer stock to maintain freshness and reduce spoilage.

“Date all sauces and enforce FIFO in the walk-in.” “FIFO cut our lettuce waste by half.”


Food Cost Percentage

Food COGS divided by food sales; a primary profitability metric managed via pricing, portioning, waste control, and sourcing.

“New supplier pricing pushed food cost to 31%.” “Menu engineering dropped food cost percentage by 1.5 points.”


Forecasting

Predicting future sales, traffic, labor, and production needs using historical data, seasonality, and local events to reduce waste and optimize staffing.

“Use 8-week trends plus events to forecast Friday prep.” “Labor forecasting needs weather and stadium schedule inputs.”


Franchise Disclosure Document (FDD)

A legal document franchisors must provide to prospects, outlining fees, obligations, performance data, and risks.

“Review Item 19 in the FDD for financial representations.” “Prospects must receive the FDD 14 days before signing.”


Ghost Kitchen

A production-only kitchen with no guest-facing storefront, used for delivery/pickup and often hosting multiple virtual brands.

“We launched a wings virtual brand from the ghost kitchen.” “Ghost kitchens let us test new neighborhoods without dining rooms.”


Gross Margin

Sales minus COGS, often expressed as a percentage; indicates how much of revenue remains to cover labor and overhead.

“Packaging costs hurt delivery gross margin.” “Shift mix to bowls improved gross margin by 300 bps.”


Guest Experience (GX)

The totality of a guest’s interactions with the brand across channels, including service, speed, quality, ambiance, digital ease, and recovery.

“Measure GX across dine-in, pickup, and delivery touchpoints.” “Kitchen noise is hurting GX at lunch.”


HACCP Plan

Hazard Analysis and Critical Control Points program that identifies food-safety risks and sets controls, monitoring, and corrective actions.

“Update the HACCP plan for our sous vide process.” “Log CCP temperatures every two hours per HACCP.”


Hold Time

The maximum time a prepared item can be held before quality or safety declines; managed via timers and batch sizes.

“Fries have a two-minute hold—don’t bag early.” “Track hold times on KDS to protect quality.”


Inventory Turnover

How many times inventory is used and replenished over a period; higher turns typically indicate fresher product and better cash use.

“Boosting turns on dairy cut spoilage costs.” “Our dry goods turnover is too low—reduce PARs.”


Just-in-Time (JIT) Inventory

A replenishment approach minimizing on-hand inventory by timing deliveries or prep close to need, reducing holding costs but increasing stockout risk.

“JIT deliveries for bread reduce backroom storage.” “JIT failed during storms—add safety stock to PAR.”


KDS (Kitchen Display System)

Digital screens that display and manage orders in the kitchen, enabling routing, timing, course firing, and throughput analytics.

“Route web orders to the KDS with expo throttling.” “KDS analytics show fry station as the bottleneck.”


KPI (Key Performance Indicator)

Critical metrics used to track performance against goals, often displayed on dashboards for operators and managers.

“Weekly KPIs: sales, labor %, food cost, RevPASH.” “Add order accuracy to our KPI dashboard.”


Labor Cost Percentage

Total labor cost (wages, taxes, benefits) divided by sales; a key efficiency and scheduling KPI.

“Labor % is spiking during shoulder periods.” “Self-ordering kiosks lowered labor by 2 points.”


Line Check

A pre-service inspection verifying that stations have the correct mise en place, temperatures, labels, and smallwares per standard.

“Complete line check 30 minutes before open.” “Sauce temps failed line check—reheat to spec.”


LTO (Limited-Time Offer)

A menu item or promotion available for a short period to drive urgency, test demand, and refresh the menu.

“Run a fall LTO to drive traffic and test new SKUs.” “Track LTO attach rate with core items.”


Loyalty Program

A structured rewards system (points, tiers, offers) that incentivizes repeat visits, data collection, and personalized marketing.

“Enroll 30% of checks into loyalty to cut CAC.” “Double points on Tuesdays lifted repeat rate.”


Meal Kit Channel

Packaging ingredients and instructions for guests to assemble or cook at home; expands brand reach beyond immediate consumption.

“Offer DIY taco kits for game day.” “Meal kits boosted off-premise revenue on holidays.”


Menu Engineering

Analyzing item profitability and popularity to optimize design, pricing, placement, and promotion for margin and mix improvement.

“Repriced and retiled menu using engineering matrix.” “Move stars to eye-scan zones to grow mix.”


Menu Mix (PMIX)

The distribution of sales across menu items over a period; informs procurement, pricing, and item rationalization.

“PMIX shows bowls outselling salads 3:1.” “Use PMIX to decide which LTO becomes permanent.”


Mise en Place

The organized setup of ingredients, tools, and stations to ensure speed, consistency, and quality during service.

“Tighten mise to reduce ticket times.” “Prep cooks finish mise before lunch rush.”


Net Promoter Score (NPS)

A loyalty metric derived from guests’ willingness to recommend (0–10 scale), used to gauge satisfaction and predict growth.

“Our NPS dipped after packaging changes.” “Promoters respond well to early LTO access.”


Omnichannel Ordering

Providing a seamless ordering experience across channels (in-store, web, app, kiosks, phone, 3PD), with unified menus, pricing, and fulfillment.

“Maintain consistent pricing across omnichannel.” “Integrate kiosks, web, and 3PD into one order stream.”


On-Premise vs Off-Premise Mix

The ratio of sales occurring in the restaurant versus takeout/delivery, shaping packaging, labor, and kitchen workflow.

“Off-premise mix is 60% on weekdays.” “Adjust batch sizes as off-premise mix rises.”


Opex (Operating Expenses)

Ongoing costs required to run the business excluding COGS (e.g., rent, utilities, repairs, software, admin).

“Rent and utilities dominate opex at this site.” “New lighting cut opex by $400/month.”


PAR Level

A target on-hand quantity for inventory or prep that triggers ordering or production to meet demand without overstocking.

“Set PAR for avocados at two days of sales.” “Vendor disruption? Raise PARs on key SKUs.”


POS (Point of Sale)

Hardware and software used to take orders, process payments, manage menus, and route orders to KDS/printers.

“Push the new menu to all POS terminals.” “We need POS-integrated tipping for curbside.”


Prep List

A daily production plan detailing what and how much to prep, by station, to meet expected demand and standards.

“Build prep lists from the sales forecast.” “Sign off when each prep list item hits PAR.”


Prime Cost

The sum of COGS and labor costs; the most controllable major cost bucket in restaurants.

“Prime cost target is under 60%.” “Recipe changes lowered prime cost by 1.8 points.”


QSR (Quick-Service Restaurant)

A restaurant format emphasizing speed, limited service, and value pricing; distinct from fast casual and full service.

“QSR throughput targets are sub-three minutes.” “Our brand skews fast casual, not pure QSR.”


Recipe Costing

Calculating the cost of an item’s ingredients and yields to set prices, maintain margins, and control variance.

“Re-cost recipes after the tomato price spike.” “Update recipe costing when portion sizes change.”


RevPASH (Revenue per Available Seat Hour)

A capacity-utilization metric dividing revenue by the product of seats and hours open; shows how effectively seating is monetized.

“Extend hours to lift RevPASH without adding seats.” “Table turns at lunch are capping RevPASH.”


Third-Party Delivery (3PD)

Delivery fulfilled and/or ordered through external marketplaces and fleets, typically with commissions, marketing tools, and SLAs.

“Shift volume from 3PD to first-party to save fees.” “Negotiate 3PD SLA on order accuracy and refunds.”


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