Translation:I'm sorry, this chicken is terrible.
There are an infinite number of ways the chicken could be terrible, but the Chinese seems to strongly imply that it's flavour is at issue. I therefore think the English should at least include the option of 'tastes terrible'.
The translation is technically 'bad to eat' which includes, amongst other things, foods that taste terrible.
'Tastes terrible' is too narrow of a translation because it could be, for example, a texture or temperature problem.
'Sorry, this chicken dish is terrible' should be accepted. The chinese sentence makes clear it is about the meat, not the chicken itself.
Why not "Excuse me, this chicken is terrible"? It could be a customer attracting the attention of the waiters?