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Free shipping delivery times edge down as retailers expand carriers
AlixPartners found 55% of retailers use carriers beyond FedEx, UPS, and the USPS, and 20% of demand is at risk from late deliveries.
Retailers are shrinking the promised delivery window while broadening the set of last-mile carriers they use, a shift that is changing last-mile delivery from a procurement choice into an operating default, according to Yahoo Finance citing AlixPartners data. AlixPartners' 14th annual Home Delivery Survey, released in June, said consumers will now wait a maximum of 2.6 days for free shipping, down from 3.4 days. The survey also found 55% of retailers use carriers outside FedEx, UPS, and the USPS, and more than a third are actively shifting volume away from FedEx and UPS.
The stakes are customer retention and costs: AlixPartners reported that 88% of shoppers said a late delivery with nothing but an apology weakens or ends their willingness to buy again, putting roughly 20% of demand at risk. At the same time, 83% of executives surveyed said per-package costs have risen year-over-year, and most said home delivery does not improve profitability.
The survey results align with parcel volume trends, including Amazon handling 6.7 billion parcels in 2025, up 9.8% and passing the Postal Service to become the largest domestic carrier by volume. USPS volume fell 8.3% to 6.6 billion, UPS dropped 8.3% to 4.4 billion, and FedEx delivered 3.6 billion, up 5.9%, while total industry volume rose 0.4% to 23.9 billion packages. Alternative carriers, including firms such as UniUni and OnTrac, grew 13% to 2.6 billion units, with revenue for that cohort up 15.4%, and none of the alternative volume growth went to UPS and FedEx.