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What is Singles Day and why is it worth $20 billion?

Chinese workers sort out parcels at a distribution centre in Taicang city.

Chinese workers sort out parcels at a distribution centre in Taicang city. Photo: AAP

China’s economy is set to get a $20 billion boost from the world’s largest shopping festival.

November 11 has become an online sales frenzy in China, with up to one billion transactions expected.

But that’s putting enormous strain on the country’s logistics companies, with some analysts warning that delivery delays could deter people from shopping.

Beijing electric tricycle courier Li Wentao said he would be delivering up to 160 parcels a day.

“It’s hard work! We’re going from 5.30am until midnight,” he said.

Mr Li is one of thousands of couriers at the front line of a major cutthroat battle for market share between China’s two largest e-commerce companies.

Jack Ma’s Alibaba, which operates the popular retail platforms Tmall and Taobao, is responsible for making November 11 into a retail frenzy.

What was once a made-up celebration of being single initiated by lovelorn university students has been ruthlessly exploited by the e-commerce giant.

The company again kicked off the 24-hour discount frenzy with a televised gala, in the hope of whipping up excitement.

Will the frenzy last?

But this year, fast growing rival Jingdong has upped the stakes, splashing out on a huge marketing campaign that brought the discount start date forward to November 1.

A worker packages toys for the November 11 Singles Day shopping festival at a factory in Yangzhou city. Photo: AAP.

A worker packages toys for the November 11 Singles Day shopping festival at a factory in Yangzhou city. Photo: AAP.

“Now Singles Day is going beyond online stores. Even offline stores are using it to do promotions, so this is becoming a big important event for all retailers,” China Europe International Business School Professor Jeongwen Chiang said.

While he believes the estimated $20 billion-plus of turnover expected this year will help push forward China’s goal of more domestic consumption, others aren’t convinced.

“Right now, our economy is declining, people’s income is stalling, so overall consumption should decline,” Beijing’s Central University of Finance and Economics Professor Wang Fuzhong said.

“Last year, there were problems — deliveries were delayed because everyone ordered on the same day.

“There were a lot of complaints.”

Professor Wang said the prospect of further delivery delays may deter potential customers.

E-commerce companies are deploying extra couriers for the sales period, in a bid to ensure the deliveries can keep up with the demand for discounts.

Regardless of whether this year’s Singles Day can break a new record, Mr Li says delivery drivers will be under the pump.

“I think this year I will be busier than last year. My current workload is already up 50 per cent”, he said.

– ABC

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