Restaurants offering all-you-can-eat buffets also attract huge crowds since everyone likes to eat to their heart's content. But things can quickly go wrong for a business that underestimates the appetite of its customers. An all-you-can-eat diner in China was forced into bankruptcy after customers decided to make the most of the promotional offer. The hot pot restaurant named The Jiamener had to cease operations in two weeks after launching an offer that allowed customers to eat all they could for just 120 yuan ($19 at the time) per month. The offer led to people flooding the restaurant every day leaving the establishment with a debt of $80,000, as reported by local news outlets and the South China Morning Post.
Too Good to be Realistic
The restaurant launched a membership card for 120 yuan ($19) that allowed customers to eat as much as they could for a whole month. Hot pot is a popular traditional Chinese meal, which is served to people sitting around a pot of simmering soup along with meat and vegetables.
While the offer seemed great for customers and the restaurant's popularity, things went wrong when people started sharing their membership with friends and family. According to the local newspaper, more than 500 diners visited the restaurant every day and people lined up outside from 8 a.m. and stayed there till late at night. While the restaurant accrued 500,000 yuan or approximately $78,000 of debt, the excruciatingly long hours were too much for the staff to handle. One of the owners, Su Jie, told the news outlet that in the two weeks described as “crazy,” he had slept for only two to three hours a night and the staff had worked over 10 hours a day. Ultimately, The Jiamener closed down in less than two weeks.
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The owners told reporters that incurring a small loss was part of their strategy aimed at beating the competition, but they did not anticipate the outcome. Su, who opened the restaurant with his college friend Wang Mengfan, admitted that “The uncivilized behavior of the diners was secondary – the main problem was our poor management,” SCMP mentioned.
A Crisis for All-You-Can-Eat Buffet?
Not just in China, but over the past few decades, buffets have seen some difficult years in the U.S. as well. While the COVID-19 pandemic dealt the industry a near-fatal blow, all-you-can-eat restaurants have long struggled with thin margins, food wastage, and heavy eaters.
Earlier this year, the popular seafood chain, "Red Lobster" filed for bankruptcy after more than 50 locations closed down due to massive losses. The new CEO, Damola Adamolekun attributed a large part of the failure to the mayhem that was caused by the restaurant's "Endless Shrimp" promotional offer. The offer which was wildly popular with guests, turned out to be too costly for the restaurant chain which was already dealing with losses. The offer also put stress on servers and kitchen staff, Adamolekun told CNN in an interview.
Shrimp is a “very expensive product to give away endlessly,” he said, before adding, "People are coming in and sitting down at the table and eating for hours as much shrimp as they possibly can." He further explained that it caused trouble for other customers too as they couldn't get a table. "It creates a lot of chaos,” Adamolekun commented.
