Aori Ramen chain collapses, hit by coronavirus, scandal
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Japanese ramen chain Aori Ramen has declared bankruptcy after suffering from coronavirus and the boycott on Japanese goods in South Korea.
All Aori Ramen branches will be shut down, including those in Malaysia and China.
According to Koreaboo, Aori F&B filed for bankruptcy with the Seoul Bankruptcy court with its debts exceeding the value of its assets.
Aori F&B said after its founder Seungri was involved with the Burning Sun scandal, the company experienced major losses with sales plunging by more than 50 percent. Aori F&B then cut ties with the South Korean singer, hoping the restaurant would gain its customers back.
The company also stated in a statement that the South Korean consumer boycott of Japanese goods also affected its business. With the subsequent coronavirus outbreak decimating restaurant patronage it is no longer able to pay its debts.
The Seoul Bankruptcy Court’s decision has yet been made as the court wants to investigate further the Aori F&B’s ability to pay its debts.
Questions & Answers
Q.What were the primary reasons cited for Aori Ramen's bankruptcy declaration?
What were the primary reasons cited for Aori Ramen's bankruptcy declaration?
The company declared bankruptcy due to significant losses following its founder's involvement in the Burning Sun scandal, a consumer boycott of Japanese goods, and the subsequent impact of the coronavirus outbreak on restaurant patronage.
Q.Did Aori F&B take any steps to mitigate losses after the scandal involving its founder?
Did Aori F&B take any steps to mitigate losses after the scandal involving its founder?
Yes, Aori F&B cut ties with its founder, South Korean singer Seungri, hoping this action would help the restaurant regain its customer base and improve sales figures after experiencing major losses.
Q.Has the Seoul Bankruptcy Court finalised its decision regarding Aori F&B's bankruptcy filing?
Has the Seoul Bankruptcy Court finalised its decision regarding Aori F&B's bankruptcy filing?
No, the Seoul Bankruptcy Court has not yet made a final decision. The court plans to investigate Aori F&B's ability to pay its debts further before concluding the matter.
Q.How did the Burning Sun scandal specifically affect Aori F&B's business operations?
How did the Burning Sun scandal specifically affect Aori F&B's business operations?
Following the founder's involvement in the Burning Sun scandal, the company experienced major losses, with its sales plunging by more than 50 percent, directly impacting its financial stability.
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