Same-day delivery costs have plummeted 44% since 2018.

That's just one of the insights driving smart retailers to rethink their approach to local fulfilment. According to this year's State of Shipping report, one in five ANZ retailers are investing in ship-from-store capabilities, turning physical locations from static showrooms into agile fulfilment hubs. And with 15% of all deliveries travelling less than 15km on Shippit’s platform, the economics of local commerce have shifted.

But the opportunity isn’t the same as the execution. Getting local fulfilment right means rethinking more than just speed, it’s about aligning delivery density, operational readiness, and customer expectations in ways many teams haven’t yet attempted.

As Nate Elias, Senior Shipping Solutions and Pricing Manager at Shippit, puts it: “Delivery used to be a backend thing. Now it’s part of the brand experience.”

Thinking about optimising or implementing ship-from-store? We’ve just released a new ebook all about it, in partnership with Fluent Commerce 👉 download it here.

For this edition of Delivered, Nate draws on five years building local commerce partnerships plus frontline logistics experience at DHL and FedEx, to show how retailers can unlock margin, not destroy it, with fast delivery done right.

TL;DR

• Same-day is the new express: Same-day delivery costs have fallen from $31 in 2018 to $17.39 today, only $3 more than express. Rising delivery density means carriers are making fewer stops for more orders, turning fast delivery into a viable margin-positive option.
• Your stores are untapped fulfilment goldmines: Around 15% of deliveries on Shippit travel less than 15km. Ship-from-store doesn’t just mean faster delivery, it’s a way to activate idle store inventory, cut markdowns, and turn retail locations into mini distribution centres.
• Data is your competitive weapon: Two-thirds of retailers aren't using delivery data. Those who do are making smarter routing decisions, improving SLAs, and outcompeting on customer experience.

Local commerce + fast delivery = your advantage

"Delivery used to be a backend thing, just about getting it there," Nate explains. "Now it's really part of the brand experience. People expect speed, flexibility, transparency."

But local commerce solves a different problem than just speed. It's about customer psychology. "On-demand fits that shift. It's not just about speed anymore. It's about unlocking that customer and locking them in before they change their mind."

The window between checkout and buyer's remorse is shrinking, particularly for younger demographics who represent an outsized influence on retail expectations. Fast delivery helps close that gap, but local fulfilment takes it further by making speed economically sustainable.

👉 Data Point: 15% of deliveries travel less than 15km from origin to destination

👉 Strategic Implication: If you have stores within 15km of your high order-density postcodes, you're sitting on untapped fulfilment capacity that could reduce costs and delivery times simultaneously.

Same-day delivery costs have transformed dramatically. In 2018, retailers paid around $31 for same-day delivery. Today, it's $17.39, a 43.9% drop.

What’s driving the shift? Nate points to three forces working together:

• rising customer demand (fuelled by the Amazon effect),
• a surge of on-demand carriers entering the market, and
• growing delivery density.

More orders flowing through fewer postcodes mean carriers can make fewer stops for more parcels, while increased supply pushes competition and pricing efficiency.

This density effect extends beyond individual orders. Carriers are achieving better route optimisation, and retailers are discovering that local fulfilment often costs less than traditional distribution models when you factor in the complete last-mile journey.

Top 5 categories where we're seeing strong local delivery demand (inventory delivered within 15kms):

• Pet Food and Supplies
• Children's Products
• Cosmetics and Toiletries
• Fashion Accessories
• Food and Beverages

And the data backs it up. Petbarn, Australia’s leading pet retailer, has seen customers who choose on-demand delivery spend 3.5x more and order 35% more frequently.

Ship-from-store: But, why now?

One in five ANZ retailers are investing in ship-from-store capabilities in the coming year (according to the State of Shipping report), but many logistics teams remain hesitant about operational complexity.

"The obvious win is speed," Nate says, "but there's more to it than just speed. You're unlocking more inventory, reducing markdowns, turning stores into revenue engines. They're not just showrooms, they're like mini DCs."

By fulfilling locally, retailers tap into stock that would otherwise sit idle and can keep product moving at full price. When peak season hits and DCs are stretched, stores add much-needed capacity without extra infrastructure. Distributed inventory also builds resilience, reducing dependency on a single hub and helping retailers pivot when disruptions hit.

Customer expectations for visibility have shifted fast. “Think of UberEats,” Nate says. “That’s the benchmark now. People want to know exactly where the order is, when it’s arriving, and get updates in real-time.”

Strategic advantages of ship-from-store

• Inventory optimisation: Products sitting idle in stores become active revenue generators rather than markdowns waiting to happen.
• Peak season capacity: When distribution centres are overwhelmed, stores provide crucial additional fulfilment capacity without capital investment.
• Network flexibility: Distributed inventory reduces dependency on single points of failure and improves overall system resilience.
• Competitive differentiation: Physical store networks become advantages that pure-play online competitors struggle to match.
• Freight cost savings: By placing inventory closer to customers, retailers shorten last-mile distances, reducing both delivery times and shipping costs.

Implementation requirements

"The objection comes from how they incorporate those processes in their store efficiently," Nate acknowledges. "Inventory visibility is really important when you're doing ship-from-store."

Critical success factors:

• Real-time inventory visibility: Accurate stock data across all locations prevents overselling and ensures reliable order allocation. This typically sits within an Order Management System (OMS) such as Fluent Commerce which provides the orchestration layer that multi-carrier shipping platforms like Shippit then executes against.
• Smart order routing: Automated systems that consider proximity, stock levels, carrier coverage, and store capacity. OMS partners play a key role here by making the allocation decision, with your shipping platform ensuring the right carrier executes the delivery.
• Streamlined store processes: Pick-and-pack workflows that integrate with existing store operations without disrupting customer service.
• Change management: Comprehensive training programs that prepare store teams for new responsibilities.

👉 Data Point: Rolla's achieved 10% freight cost reduction with ship-from-store

👉 Strategic Implication: Ship-from-store isn't just about speed, it's a cost optimisation play. If you have 5+ stores, the ROI case is likely there.

When ship-from-store doesn't make sense

Not every retailer should pursue distributed fulfilment. Ship-from-store simply wouldn't make sense if there isn't enough density around that location. Another real challenge is order consolidation: if a customer buys two items and they’re fulfilled from different stores, the customer still expects a single, unified tracking experience. On the retailer’s side, that creates additional shipping costs that need to be managed.

Signs that you shouldn’t try ship-from-store:

• Insufficient order volume within carrier delivery radii
• Operational challenges with carrier pickup requirements
• Poor inventory accuracy that creates stockout risks
• Limited store capacity during peak traffic periods

This is where the right delivery partner matters. Platforms like Shippit can consolidate split orders into a single customer-facing tracking experience, even when items are fulfilled from different stores or carriers. Behind the scenes, Shippit automatically allocates orders across the right carriers and locations based on your rules. That way, customers enjoy a seamless experience, while retailers maintain efficiency and margin control.

Ship-from-store + peak season = a match made in heaven?

Peak season is when local delivery proves its worth. Nate’s seen retailers test on-demand or ship-from-store before the holiday rush, then roll it out fully afterwards because of the extra capacity and flexibility it brings.

The key is operational readiness. “The thing to keep in mind is that change management piece and ensuring you’ve got the in-store processes in place to offer shipping from store on standard, but also on on-demand orders where you’ve got less time for the pick-pack process.”

What do stores need for peak seasion success?

Peak season exposes every weak link in the fulfilment chain. It’s not enough to have staff picking faster as the systems, teams, and processes need to hold up under pressure.

✅ Efficient pick-pack workflows under pressure: Store teams must be able to process high volumes without disrupting in-store service. Simple, intuitive workflows minimise training time and keep quality consistent.

✅ Real-time inventory visibility across channels: During peak, a single missed stock update can snowball into overselling, refunds, and support blowouts.

✅ Cross-team alignment and shared KPIs: Ops, ecommerce, and logistics teams need a single source of truth on how orders are attributed and measured. Without this, you risk finger-pointing when SLAs slip.

✅ Repeatable, stress-tested processes: Promotions and flash sales are the perfect time to “stress test” store fulfilment before peak. Repeatable workflows give teams the muscle memory to handle volume spikes without cutting corners.

The tech that makes it possible

For distributed fulfilment to work at scale, Nate says retailers need:

• Real-time stock visibility across all locations to prevent overselling and enable accurate promise dates.
• Smart order orchestration that considers proximity, stock levels, carrier coverage, and store capacity before allocating an order.
• Simple, store-friendly interfaces so fulfilment tasks don’t disrupt customer service.

But, do you have a delivery data gap?

Here’s where most retailers are missing out. “Two out of three retailers aren’t even using their delivery data,” Nate says. “It’s kind of like running ads without checking your return on ad spend.”

For many, the issue is access as they don’t have the right tools to see or interpret their data, and rely on carrier partners to provide reporting data, often on a fortnightly or monthly cadence. This means the retailers who do have access get an edge in their space, as it helps them better plan for demand and assess carrier performance before the busiest period of the year, keeping their delivery estimates in tip-top shape.

👉 Data Point: Only 1 in 3 retailers regularly use delivery data to optimise operations

👉 Strategic Implication: Delivery analytics is becoming a competitive differentiator. Retailers who master data-driven logistics gain significant operational advantages over competitors flying blind.

Pre-peak preparation checklist

Say you’re convinced ship-from-store is the way to go - what’s next?

The key is not to roll out everywhere at once. Start small, prove success, then scale. A pilot group of 3–5 stores helps you test workflows under pressure without overwhelming your teams.

Here’s a handy checklist to go by:

✅ Operational training: Prepare store teams for pick-pack responsibilities with simple, repeatable workflows.

✅ Inventory system verification: Confirm real-time stock visibility works accurately, especially during high-transaction periods.

✅ Carrier capacity planning: Secure on-demand provider availability during peak and set up backup protocols.

✅ Process stress testing: Use smaller promotional periods to uncover bottlenecks and refine before scaling.

When that pilot succeeds, expanding to more stores becomes a natural, data-backed next step.

Beating Amazon with local store networks

In 2025, a topical question is: How can local retailers compete with Amazon's same-day capabilities?

Nate thinks focusing on differentiation through faster, local delivery, rather than trying to beat them with size, is the key.

What does that mean exactly?

• Proximity: Store networks provide geographical coverage that pure distribution models struggle to match economically.
• Brand: Local delivery through retail shipping platforms enables fast, reliable, on-brand experiences rather than generic courier interactions.
• Network: Multiple store locations become distributed fulfilment advantages when coordinated effectively.
• Speed: Focus on delivering exceptional customer experiences, not just fast delivery times.

"You pair that with an on-demand or same-day solution through a streamlined shipping platform and you can deliver fast, reliable, and on-brand delivery experiences. The secret is speed with control, not just speed for the sake of speed."

Local commerce isn't exclusively for large retail chains, either. "The misconception is you don't need to have a big store footprint to benefit from local delivery," Nate clarifies. “The key is understanding where your delivery density supports the economics and starting there rather than trying to serve all areas immediately.”

Logistics and ops leaders: For your ship-from-store planning session👇

✅ Map your current delivery density

Use your past delivery data to work out the concentration of orders relative to store locations. Assess the viability of starting with high-density metro postcodes for ship-from-store first.

✅ Audit operational readiness honestly

Do an (honest) review of your store pick-and-pack capabilities. Look at staff capabilities, resourcing gaps, and whether you need to plan for training, before deciding to add fast delivery to avoid operational bottlenecks and customer disappointment.

✅ Do some contingency planning

Look into multi-carrier platforms with automatic order reassignment features. Ensure that if your on-demand delivery processes fail, your tech provides a back-up plan and doesn’t leave your customers, and you, in the lurch.

✅ Start using your delivery data

Two-thirds of retailers aren't leveraging delivery insights. Make it a habit to benchmark carrier and delivery performance metrics on a regular cadence. This is how you future-proof delivery promises, and identify expansion opportunities, after implementing ship-from-store.