The language of bar and restaurant management, explained plainly — from food cost to menu engineering.
An allergen matrix is a grid that maps every menu item against the 14 allergens the EU requires to be declared, giving staff and guests an at-a-glance record of which dishes contain what.
AP (as-purchased) is what an ingredient weighs and costs when it arrives; EP (edible portion) is what remains after trimming, peeling, and cooking loss — and EP is the only figure that reflects true recipe cost.
Beverage cost percentage is the cost of the drinks sold divided by the revenue those drinks generate, expressed as a percentage; most bars target somewhere between 18 and 24%.
Food cost is the ex-tax cost of the ingredients in a dish expressed as a percentage of its ex-tax selling price; it tells a kitchen how much of every unit of food revenue is spent on raw product.
Free-pour variance is the gap between the spirit a recipe specifies and the amount a bartender actually pours by eye instead of measuring; left unchecked, it typically runs 10 to 20% over spec.
Gross margin is what remains of an item's ex-tax selling price after subtracting the cost of its ingredients — the mirror image of food or pour cost, and the money left to cover labour, rent and profit.
The markup coefficient is the multiplier applied to an item's ex-tax ingredient cost to reach its ex-tax selling price; a cost of 3 at a coefficient of 4 gives a 12 selling price.
Menu engineering ranks every dish by popularity and profitability, then sorts the items into four groups (stars, plowhorses, puzzles and dogs) to guide pricing, placement and menu-redesign decisions.
The menu selling price is the price charged to the guest for a dish or drink, built from its ex-tax ingredient cost and a target margin, then grossed up with VAT to the tax-inclusive figure shown on the menu.
A par level is the target quantity of an item you keep on hand — set from usage rate, delivery lead time, and a safety buffer — so that when stock drops to it, you reorder, and you never run out or over-stock.
Pour cost is the bar's equivalent of food cost — the ex-tax cost of the spirits, mixers and garnish poured into a drink, expressed as a percentage of its ex-tax selling price.
Prime cost is the sum of a venue's cost of goods sold — food and beverage — and its total labour cost; together they are the two biggest controllable expenses, typically targeted at roughly 55-65% of revenue.
A recipe spec sheet is the single reference document for one dish or drink, listing exact ingredients, quantities, method, plating or build, allergens and cost, so anyone on the team can reproduce it identically.
Shrinkage is the gap between the stock you should have on paper — theoretical usage based on what you sold — and the stock a physical count actually finds; in bars it can reach 20% of inventory.
Yield percentage is the share of a purchased ingredient that survives prep and cooking to reach the plate — usable output divided by starting weight — and it is what converts a purchase price into a true per-portion cost.
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