Aussie retailers under pressure from e-commerce giants
Australians are paying more for online deliveries, and while it’s faster and easier, the rise of global e-commerce giants could spell trouble for local retailers.
Shipping software platform Shippit says consumers will pay an average of $11.30 for delivery in 2026, as labor, fuel and maintenance costs continue to rise. This figure was $10.39 the previous year.
More than 71 percent of shipping companies say fuel price volatility is now their biggest operational challenge, while more than two-fifths have implemented fuel surcharges as a result, according to Shippit’s State of Shipping report.
While delivery is faster and more reliable than ever before, providing an accurate timeline for buyers was vital as players such as Amazon, Temu and Shein continued to grow market share.
Shippit co-founder and joint CEO Rob Hango-Zada said the growing share of Australia’s retail spending going to overseas companies was a major concern.
“Protecting Australian retail and encouraging greater competition is hugely important not only for the consumer but also for the national economy,” he told AAP.
Amazon accounts for nearly one in five Australian dollars spent online, and along with Temu and Shein, the three companies are expected to control 36 per cent of national e-commerce revenue in 2026.
But it’s not just cost that draws buyers to the platforms, with speed, accurate mailing timelines, free returns and bad previous experiences driving preferences.
Amazon’s automated, 24/7 distribution centers allow the US tech giant to offer consumers an accurate countdown timer for delivery from the moment of purchase.
“It’s extremely difficult for a retailer to offer this in the Australian market because there are a lot of disconnected systems running through this process,” Mr Hango-Zada said.
“Where Shippit comes in is connecting a lot of these different pieces together and enabling a retailer to make a very accurate promise while also adding precision to the delivery experience itself.”
One in two Australians say Amazon has raised their expectations of other retailers.
Retailers advertise an average delivery time of 5.2 days, but actual delivery transit times average 2.2 days.
“Retailers actually underpromise, so they may overdeliver, but that has a big impact on conversions,” Mr. Hango-Zada said.
However, local chains have an advantage in the distribution of physical stores.
“We see the potential to sit in store locations across the country and carry product that is already sitting pretty close to the consumer and put it in a van right to their door,” Mr. Hango-Zada said.
“You know, we see a huge opportunity, but the window is definitely closing.”
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