A hotpot restaurant located in Chengdu, Sichuan province, China closed its doors permanently after offering an all-you-can-eat buffet for its customers for only $19.
Hotpot restaurants are popular in Chengdu and are a must-try when visiting Sichuan. To stand out from its competition, Jiamener initiated a promotional stunt that became widely popular in June.
The promotional scheme urged the customers to buy a membership card in order to have unlimited food over the course of one month. However, only two weeks after it started offering the card, the Chinese restaurant's stunt proved to be a catastrophe.
Why The Restaurant Failed
According to South China Morning Post, the Chinese restaurant was left with $78,000 in debt. After offering unlimited food for such a low amount, people began flooding the restaurant to take advantage of its buffet. Customers would start to line up at 8 a.m. and the last customer would not leave until midnight.
ABC Australia added that some customers who bought the membership card shared it with their friends and family which contributed to the increased amount of meals consumed in a single purchase.
According to Chengdu Economic Daily, one of the owners said that they knew they would be losing money. However, they wanted to get more loyal customers through their promotion.
The closing of the restaurant has served as a lesson to the owners in terms of position in dealings. They initially thought that the success they had hoped for would help them build better relationships with their business partners and help them get discounts in the future.
In the two weeks that they offered all-you-can-eat buffet, they had over 500 customers each day with lines that would stretch around the street corner. Sui Jie, one of the owners, said he only slept two to three hours each night and restaurant staff were prompted to work for more than 10 hours per day.
Jakarta Post reported that Jiamener paid other restaurants to accommodate their customers to divert the extreme flow of their clients.
Furthermore, news of the restaurant's bankruptcy became viral on China's social media.
"The owner gets himself out of business," said Shao Xingfeng, a user from Weibo.
"This [restaurant owner] is really careless, didn't think through," another user, Si Yan Du Bu, added.
Su opened the restaurant with his college friend Wang Mengfan last December and admitted that aside from the customers' uncivilized behavior, they had problems with poor management as well.