Australian retailers fear Amazon, Temu & Shein dominance

Shippit says 82% of Australian retailers are concerned about the growing dominance of Amazon, Temu and Shein, which its latest State of Shipping Report forecasts will control 36% of Australian eCommerce in 2026.

The findings come as Amazon runs its Prime Big Deal Days promotion at the start of the pre-peak shopping period. Retailers are also facing higher borrowing costs after Australia's cash rate rose to 4.60%.

Shippit's report draws on hundreds of millions of deliveries, as well as surveys of consumers, retailers and carriers across Australia and New Zealand. It points to a retail market in which delivery is becoming both more expensive and more important to customer retention.

More than half of Australian shoppers (52%) said Amazon has raised their delivery expectations, up from 31% in 2025. The figure was higher among younger consumers, reaching 55% for Gen Z and 57% for Millennials.

That shift is carrying a penalty for retailers that disappoint customers after checkout. The report found 68% of shoppers were unlikely to return to a retailer after a poor delivery experience, up from 64% a year earlier.

Asked what would persuade them to buy from a retailer, 40% of shoppers cited cost-effective delivery and 34% cited fast delivery. Those priorities are central to the offer of large eCommerce platforms, which have trained consumers to expect speed at low cost.

"Retailers that fail to meet the expectations set by Amazon may not feel their brand eroding today, but they risk long-term erosion of lifetime customer value as younger consumers consolidate their loyalty around the few brands that consistently deliver frictionless experiences," said Rob Hango-Zada, Co-Founder and Joint-CEO of Shippit.

Rising costs

Delivery charges in Australia increased across the main service categories compared with 2025. Standard delivery rose to AUD $11.30 from AUD $10.39, while express delivery increased to AUD $15.50 from AUD $14.69.

The average spend required to qualify for free shipping also climbed, to AUD $135 from AUD $123. Only 8.8% of retailers now offer free shipping with no minimum spend, the data shows.

Fuel costs are adding to the pressure. Almost half of carriers surveyed had introduced temporary fuel surcharges this year, feeding through to checkout prices for consumers and narrowing retailers' ability to absorb logistics costs.

Returns policies have tightened at the same time. Just 11% of retailers offer free returns, down from 49% in 2018, even though a quarter of shoppers said they would not buy from a retailer that did not offer free or easy returns. Another 21% said they would hesitate.

Promise gap

The report also highlighted a mismatch between what retailers tell customers to expect and how quickly orders actually arrive. On average, retailers advertise a delivery window of 5.2 days at checkout, while the average parcel arrives in 2.2 days.

Shippit said that gap can drag on conversion, as customers may abandon purchases if the quoted timeframe looks too slow even when the delivery network is moving faster.

"To meet consumers' needs for fast and cost-effective delivery, retailers need genuine carrier diversity. The best option for a customer in Sydney isn't the same as the best option for a customer in regional Western Australia. Retailers who rely on a single carrier to solve that problem are limiting their growth potential. Independence and flexibility in your carrier network is no longer a nice-to-have, it's a competitive advantage," said Hango-Zada.

In a separate comment on fulfilment times, he said retailers need to address the gap between checkout messaging and actual service levels.

"The gap between what retailers promise at checkout and what they deliver is the biggest conversion killer in eCommerce today," said Hango-Zada. "With Amazon able to fulfil orders within 15 minutes, and shoppers demanding fast delivery and turning their back on brands that fall short of their expectations, closing that fulfilment gap must be an operational priority for retailers."

The report draws on proprietary booking information collected between 2018 and 2026, a consumer survey of 1,021 people in Australia and New Zealand, a survey of 109 decision-makers at mid-market and larger retail businesses, desktop research covering 1,670 Australian retailers and 270 New Zealand retailers, and carrier research covering businesses responsible for hundreds of millions of annual deliveries.