Pizzeria Glossary

Food cost plus labor cost, as a share of sales. It is the fastest single read on a shop’s health, before rent and everything else, and it is worth checking weekly rather than monthly.

Go deeper: Know Your Numbers. Run a Better Shop. · Run the math: Prime Cost Health Check

The gap between what your recipes say food should cost and what it actually cost. A wide gap usually means portioning drift, waste or shrink, not a supplier problem.

Go deeper: Know Your Numbers. Run a Better Shop.

Everything the space costs you: base rent plus property taxes, insurance and common-area maintenance, measured against sales. It is the cost you fix once, at the lease table.

Go deeper: Read Your Lease Like a P&L — Occupancy Is the Cost You Fix Exactly Once · Run the math: Occupancy Cost & Lease Quota

Add-ons per order, such as drinks per order. When the add-on carries a fat margin, raising the attach rate is one of the cheapest profit levers a shop has.

Go deeper: Know Your Numbers. Run a Better Shop.

Net sales divided by paid labor hours. Set a target for each daypart, because a healthy weekly average can hide shifts that lose money.

Go deeper: The Minimum Wage Moves Jan. 1. So Does the Point Where Your Slow Shifts Lose Money. · Run the math: Labor by Daypart

A block of the business day with its own sales pattern, such as lunch, the afternoon lull or the dinner rush. Labor percentage and the schedule both make more sense by daypart than by week.

Go deeper: Your Labor Percentage Is Averaging a Dead Tuesday Against a Slammed Friday · Run the math: Labor by Daypart

The cut a third-party app such as DoorDash or Uber Eats takes from each order it sends you. Payment processing and promotions stack on top, so the all-in cost of a marketplace order runs higher than the headline rate.

Go deeper: Uber Eats Raised Your Rate in March. DoorDash Changed Your Customer's Fees in July. Here's the $30 Order Now. · Run the math: Delivery Channel Breakeven

Orders that come through your own website or app: your customer, your data, your margin. The opposite is a marketplace order, where the customer relationship and the commission belong to the app.

Go deeper: The Marketplace Finds You New Customers. Stop Paying It 25% to Keep the Old Ones. · Run the math: Delivery Channel Breakeven

Scoring every item in a menu category on two things, its contribution margin and its popularity, then raising, featuring, keeping or cutting it based on where it lands. The method comes from Michael Kasavana and Donald Smith.

Go deeper: Stop Raising the Whole Menu. Raise the Items That Can Carry It. · Run the math: Prime Cost Health Check

An item’s price minus its food cost, in dollars. In menu engineering it is compared against the weighted average for the item’s category.

Go deeper: Stop Raising the Whole Menu. Raise the Items That Can Carry It.

The four menu-engineering groups. Stars are popular with a fat margin. Plowhorses are popular with a thin margin. Puzzles are unpopular with a fat margin. Dogs are unpopular and thin.

Go deeper: Stop Raising the Whole Menu. Raise the Items That Can Carry It.

The price customers already have in their heads before they open your menu. For pizza that is often a national chain’s value deal, which is why the fight is to keep your menu from being compared with it.

Go deeper: The Seven-Dollar Pizza Problem: The Chains' Value War Isn't Yours to Win

The price of block cheddar traded on the Chicago Mercantile Exchange. Most pizza cheese is priced off it, so your distributor’s quote moves when the block does.

Go deeper: Block Cheese Hit a Near-Decade Low, Then Jumped 30 Cents in a Week. Don't Lock Your Contract on the Spike.

Proofing dough slowly in the cooler over days instead of the same day. It builds flavor, and it turns dough from a daily emergency into inventory you can plan around.

Go deeper: Cold Ferment, Hot Margins: The 48-Hour Dough Schedule Is a Business System

A lease where you pay the property’s taxes, insurance and maintenance on top of base rent. Most restaurant leases are written this way, with base rent set low and the pass-throughs doing the climbing.

Go deeper: Read Your Lease Like a P&L — Occupancy Is the Cost You Fix Exactly Once · Run the math: Occupancy Cost & Lease Quota

Your share of the landlord’s cost to run the shared parts of a property, billed on top of base rent. Lease language decides how fast it can climb, so the cap and the audit right matter more than the starting figure.

Go deeper: Read Your Lease Like a P&L — Occupancy Is the Cost You Fix Exactly Once

Rent charged as a cut of sales above a set sales level, the breakpoint. The natural breakpoint is annual base rent divided by the percentage, but nothing requires either side to use it.

Go deeper: Read Your Lease Like a P&L — Occupancy Is the Cost You Fix Exactly Once

A limited personal guarantee that ends when you leave the space properly, with notice and no unpaid rent, instead of following you after the shop closes. It is largely a New York convention, but you can ask for its substance anywhere.

Go deeper: Read Your Lease Like a P&L — Occupancy Is the Cost You Fix Exactly Once

The document a franchisor must give every prospective buyer, including an estimated opening cost and sometimes what existing stores earn. It is the most honest public estimate of what a pizza shop costs to open.

Go deeper: What It Really Costs to Open a Pizza Shop in 2026

Cash set aside to pay rent and payroll while sales ramp after opening. It is the money first-time owners most often underfund, because it isn’t on the build-out list.

Go deeper: What It Really Costs to Open a Pizza Shop in 2026

A shop’s cash flow before the owner pays themselves. Business-sale listings use it because a buyer wants to see the owner’s full cash flow, which means it has to cover your own wage.

Go deeper: How Much Do Pizza Shop Owners Make? Less Than the Margin Suggests, Until Volume Kicks In

How long a new store takes to earn back the cash invested to open it. Staying open and earning that cash back are different milestones.

Go deeper: A Pizza Shop's First Three Years: What Revenue and Survival Actually Look Like