Glossary /
Customer Lifetime Value (CLV)
Written by PEKO Team.Last updated: 2026/05/21.
Customer Lifetime Value (CLV) is the total revenue a customer generates for your business across their entire relationship with you, before they churn.
Published: 2026/05/01
For most independent F&B businesses, CLV = Average Order Value × Visit Frequency per Year × Average Customer Lifespan in Years. A small change in any of the three multipliers compounds dramatically.
Reducing churn by even 5 percentage points usually doubles CLV, because customer lifespan extends from ~14 months to ~28 months. This is why retention investment outperforms acquisition spend almost every time once you're past the launch phase.
Worked example
A café with $8 AOV, 2× monthly visit frequency, and 12-month average lifespan has CLV = $8 × 24 × 1 = $192. Push lifespan to 24 months and CLV jumps to $384 — without acquiring a single new customer.
FAQ
How do I calculate CLV for my restaurant?
CLV ≈ Average Order Value × Annual Visit Frequency × Average Customer Lifespan (in years). Pull the first two from POS; estimate the third from when active customers typically churn.
What is a good CLV for an F&B business?
There is no universal benchmark — it depends on price point. The more useful KPI is the CLV-to-CAC ratio: aim for ≥3:1 (lifetime value at least 3× the cost to acquire).
Sources
The definitions and figures on this page reference the sources below:
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