JAKARTA - One of the largest networked cafes in China was fined 2 million yuan or around Rp.4.3 billion after being caught making 123 million fake orders.
Reported by Antara, the China Market Regulatory Agency (SAMR) in its decision published on Monday, October 12 imposed fines on five companies, mainly Luckin Coffee China Co Ltd.
Luckin Coffee China and Luckin Coffee Beijing during the April-December 2019 period collaborated with several third-party companies to fake 123 million orders, according to the ruling circulating in a number of media.
The institution that regulates business competition in China revealed that Luckin Coffee hired several individuals and companies to make fake orders.
This action aims to increase revenue and banking transaction records so that they can mislead consumers, according to SAMR.
The institution ordered the networked cafe managers to end scandals and compete fairly.
Luckin Coffee, also known as Ruixing Kafei, was founded in Beijing in October 2017. However, it wasn't until January 2018 that it opened its first shops in Beijing and Shanghai.
That same year Luckin Coffee opened 1,300 stores throughout mainland China. That number surpassed Costa Coffee's shop to occupy the second position of the largest cafe in China.
In recent years, competition for cafes in China has become more intense as the lifestyle of local people, especially young people, have started to enjoy drinking coffee after tea has been a tradition for centuries.
It is this lifestyle change that prompted Starbucks to open its largest store and coffee education center in Shanghai two years ago.
Starbucks Reserve Roastery in Shanghai is the first Starbucks coffee shop and education center to be built outside the United States
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