Mr Leo Liu, manager of the sprawling Wankelai store in the Chinese capital of Beijing, spoke into a microphone, announcing progressively steeper discounts in a flash sale, until he finally sold a cotton jacket and a women’s undershirt.

In a symptom of China’s deflationary economy, he eventually found a customer for the jacket at 20 yuan (S$3.70), or less than a tenth of its initial price of 239 yuan, but he ended up giving away the 39 yuan undershirt, for which nobody wanted to pay.

Chinese consumers grappling with uncertainty about jobs and incomes are increasingly turning to discount stores at a time of expanding industrial capacity in the face of sluggish household demand.

But analysts say the success of such businesses is stoking deflationary pressures, which can start to drag on growth as their popularity grows at the expense of other retailers, as Japan experienced in the 1990s.