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‘All-you-can-eat’ promo drives restaurant in China to bankruptcy

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The restaurant offered the ‘all-you-can-eat deal’ to the membership card holders.

The Jiamener hotpot restaurant in Chengdu, Sichuan province, in China succumbed to the losses incurred by their ‘all-you-can-eat’ promo. A promotional strategy gone wrong ended up causing bankruptcy to its owners.

The restaurant offered the ‘all-you-can-eat deal’ to the membership card
holders. This membership cost around $19.33, this card was being

passed on to family members and friends by the customers.

As per a report, in addition to this loss, Jiamener also paid other restaurants to divert their excessive customer flow due to which they racked up 500,000 yuan in debt (around Rs 52,59,559.25). During the promo around 500 people swarmed the place on a daily basis. Customers would line up right from 8 am and wouldn’t leave until midnight. Such was the scenario that the owners themselves along with their staff were barely getting any rest. The staff worked over 10-hour shifts, including the owners.

“We knew we would be losing money. We wanted to accumulate more loyal clients through this strategy,” said one of the owners, according to the report. The owners admitted that it was a bad business decision on their part which cost them their restaurant, coupled with bad customerbehaviour .

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