Mid-Year 2026 Report
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SUPPLY CHAIN
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Introduction I. Market Overview II. Transportation Market III. LTL Market IV. Parcel Market V. Warehousing & Inventory VI. Warehouse Real Estate Market VII. Labor Market VIII. Innovation, Automation & AI IX. Final Takeaways X. Kenco Updates About Kenco
At the end of 2025, the supply chain market appeared to be entering a fragile recovery. Transportation rates were beginning to move. Inventory strategies were shifting. Industrial real estate was stabilizing. Labor pressures were evolving. Automation, AI, and digital tools were becoming less experimental and more essential.
This mid-year report revisits the major trends identified at the end of 2025 and looks at how those predictions are holding up against the market today. The goal is not to overstate certainty in an uncertain year. It is to identify what has held true, what has shifted, and where shippers can still find control through the rest of 2026.
What Held True, What Shifted, and Where Shippers Can Still Find Control
How can shippers balance cost discipline, resilience, and flexibility in a market that is still moving?
Halfway through 2026, it could be said that the market is not simply recovering — it is recalibrating.
Costs remain elevated. Capacity is tightening in key areas. Inventory strategies are being pulled between leaner operations and renewed disruption. Labor is stable on the surface, but the skills needed to run modern supply chains are changing quickly. At the same time, shippers are finding ways to adapt by strengthening carrier relationships, improving data visibility, reevaluating networks, and investing in technology that can create measurable operational value.
The big question for the second half of 2026:
I. Market Overview
The takeaway is not that demand has disappeared. It is that growth is more cautious, more expensive, and more dependent on flexible planning.
A Market Recalibrating Under Pressure
Additional touches Incorrect Carrier Selection Bad Data Inaccurate Accruals Higher Freight Spend No access to E-BOL
The risks if no action is taken:
Kenco Insight at Mid-Year 2026
We asked Dave Hauptman, Chief Commercial Officer at Kenco two questions:
Question 1: Prediction vs. Current Status At the end of 2025, we expected inflation, geopolitical uncertainty, and uneven demand to shape supply chains in 2026. How has that prediction held up at mid-year?
Growth is still moving forward, but at a slower pace. With Q1 GDP revised down to 1.6% and the rest of 2026 projected below trend, the market is showing signs of resilience without signaling a full rebound.
Future LMI of 69.4 Chart
LMI Aggregate Logistics Cost Chart
S&P Global PMI / GDP Chart
Q1 GDP Annualized Rates and Projections
Manufacturing activity improved in May, but the story is more complicated than the headline suggests. Defensive stockpiling, rising input costs, export pressure, and supply delays show that growth is being driven as much by risk management as by demand.
Logistics activity remains in expansion territory, but costs are running hot. With aggregate logistics costs at their highest level since March 2022, shippers are still navigating a market where resilience comes with a higher price tag.
The market is expected to keep expanding, with the future LMI now projected at 70.6 for June 2026. Values above 50 still point to growth, but the pressure is uneven: transportation prices lead at 87.0, while inventory costs at 76.9 and warehousing prices at 76.8 suggest cost pressure will remain a major planning factor through the rest of 2026. At the same time, transportation capacity remains below the growth threshold at 42.4, reinforcing that shippers may face a market where demand, utilization, and prices rise faster than available capacity.
Mid-Year Pulse Check
Kenco Insight
Guidance for Shippers
That prediction has held up. While some recent headline numbers suggest inflation may be moderating, inflation remains volatile. Labor costs and many raw materials have increased, while container shipping rates have come down, signaling excess capacity in parts of the market. Geopolitical uncertainty is arguably tracking worse than many forecasts anticipated, and the impact is being felt across multiple regions of the world. Threats around the Strait of Hormuz have disrupted a major share of global oil supply, raising supply chain uncertainty and adding pressure to raw material and product costs.
Question 2: Looking Ahead What market signal should shippers watch most closely through the rest of 2026?
Uneven demand is the signal shippers should watch most closely. It has been a defining trend throughout 2026 so far and is expected to continue at least through the end of the year. Sudden demand slowdowns and rebounds make planning difficult because supply chains cannot always scale quickly enough to match those shifts. That puts shippers at risk of carrying excess inventory when demand softens or missing sales when demand rebounds faster than operations can respond.
Guidance for Shippers Mid-2026
Reforecast demand, cost, and service assumptions for Q3 and Q4. Build scenario plans for tariffs, fuel volatility, supplier risk, and demand swings. Review total cost-to-serve across transportation, inventory, and warehousing together. Strengthen visibility into inventory, carrier performance, and customer service levels. Define trigger points for when to shift inventory, transportation, or sourcing strategies.
Mid-Year Checklist
Where the Market Stands Mid-2026
The prediction is holding. Growth continues, but elevated costs and disruption are limiting confidence.
Read On the Trend
Confirmed — the market is expanding, but pressure remains.
What We Expected Entering 2026
A fragile recovery shaped by inflation, geopolitical risk, uneven demand, and rising logistics costs.
The first half of 2026 has confirmed the tension shippers felt entering the year: the market is still growing, but not cleanly. GDP projections point to below-trend growth, manufacturing activity is expanding, and the LMI remains elevated — but much of that activity is tied to cost pressure, defensive inventory moves, geopolitical risk, and supply disruption.
II. Transportation Market
Fuel Eases, but Capacity Still Calls the Shots
Diesel: $4.578/gal
Fuel relief is real, but diesel is still elevated year over year and tied closely to geopolitical risk.
Freight Cost Trend: Split Signal
Fuel is down, but linehaul is still rising. Separate FSC movement from the true rate environment.
Capacity Index: Constrained
Capacity that left during the downturn has not returned in a way that meaningfully loosens the market.
Carrier Availability: Tightening
The effective driver pool remains pressured, giving carriers more leverage on pricing and tender acceptance.
Transportation entered 2026 with the question of whether the freight recession would finally break. At mid-year, the answer appears to be yes. Rates are rising, and the pressure is being driven more by constrained supply than surging demand. Capacity left the market during the downturn and has not returned in a meaningful way, while the driver pool continues to tighten and carriers regain leverage after several lean years. Fuel is the outlier. Diesel has eased from its early-May peak, but it remains elevated year over year and is moving more on crude and geopolitical risk than freight fundamentals. That means fuel relief should not be read as a softening transportation market. Linehaul rates continued rising through the first half of 2026 even as diesel moved lower. For shippers, the split signal is important: fuel may move month to month, but capacity is still setting the broader direction. Regional tightness, driver availability, rising tender rejections, and a more compliance-focused carrier environment all point to continued rate pressure through year-end.
Compliance Watch: Carrier Vetting
Higher broker liability standards raise the stakes for documented carrier selection and safety verification.
Revisit routing guides and identify weak lanes by region, mode, and carrier performance. Protect core carrier relationships before capacity tightens further in constrained corridors. Separate fuel relief from linehaul pressure when budgeting for the rest of 2026. Watch fuel volatility, capacity return signals, and weather risk heading into year-end. Tighten carrier vetting and build schedule buffers for time-sensitive freight moving through high-enforcement lanes.
We asked Ayrton Morey, Manager of Logistics Account Management at Kenco two questions:
The end-of-2025 outlook has held. Capacity left through the downturn, the market tightened, and rates are now running above last year. The wrinkle at mid-year is fuel. Diesel climbed through the spring, peaked in early May, and has eased since — even as rates continued to rise. Fuel and linehaul answer to different forces. Fuel moves with crude and geopolitics, while linehaul is driven by truck supply and demand. So fuel falling while rates keep rising is not a contradiction. Strip fuel out entirely, and linehaul still rose through the first half of the year. That tells us the increase is real, not a fuel illusion. For shippers, the takeaway is simple: do not mistake cheaper fuel for a softening freight market or expect rate relief to follow diesel down. The market has moved to the carrier’s side.
Question 2: Looking Ahead As shippers plan for the rest of 2026, what should they expect from fuel, linehaul pricing, regional capacity, and compliance-driven carrier availability?
Question 1: Prediction vs. Current Status At the end of 2025, we expected transportation pricing to gradually tighten as capacity left the market. At mid-year, fuel is easing, but rates remain above last year and capacity is still tight in several key regions. How should shippers read this split signal?
All-in rates are expected to keep rising through year-end, and the pressure is supply-driven rather than demand-driven. The constraint is the legacy of the freight downturn’s carrier washout. Operating authorities are down from their 2022 peak, more than 100,000 trucks have left the market, and the long-distance truckload workforce is at its lowest level since 2014. Fuel is the variable we cannot call. Diesel remains elevated and carries upside risk tied to geopolitical events, but its direction is hard to predict. It will determine how much a shipper’s bill moves month to month, not the direction the freight market is heading. The two signals shippers should watch most closely are fuel volatility and whether capacity begins returning later in the year. A late-year capacity return could slow rate increases, but a market-loosening influx appears unlikely before year-end. Weather is also worth watching, with potential El Niño impacts creating a more stable network in some regions while concentrating disruption risk in the Western mountain passes and flood-prone South.
That prediction has held. The freight market has turned, with rates rising even though demand is not booming. The pressure is supply-driven: fewer effective trucks, a tighter driver pool, and carriers rebuilding margin.
Confirmed — and more clearly carrier-favorable than expected.
Transportation pricing would gradually tighten in 2026 as capacity continued to leave the market.
III. LTL Market
Efficiency Becomes the Pricing Lever
LTL remains in a market where better data can directly influence cost. At the end of 2025, the prediction was that carriers would continue emphasizing pricing discipline, freight density, shipment accuracy, E-BOL, consolidation, and network efficiency. That still holds.
Mid-year carrier performance shows meaningful variation across operating ratios, tonnage, yield, and network performance. For shippers, that means carrier fit matters more than ever. The strongest LTL strategies are moving beyond rate shopping and focusing on clean freight data, the right carrier mix, and smarter shipment planning.
Carrier Market Performance
Carrier Volume Trends
Public Carrier Scorecard
Operating ratios show a wide performance gap across public LTL carriers, with ODFL remaining best-in-class while several carriers continue working through margin pressure.
Volume trends were mixed in Q1, with ABF leading tonnage gains while ODFL traded volume for yield and XPO remained near-flat with improving margin signals.
The scorecard shows that carrier strategy is diverging, with some providers prioritizing yield and margin while others are gaining volume at the expense of pricing or operating efficiency.
Audit pallet dimensions, weights, freight class, and NMFC accuracy. Identify reclass, reweigh, and avoidable accessorial exposure. Review E-BOL readiness and digital documentation processes. Analyze consolidation and pool distribution opportunities. Match freight profiles to carriers with the right network fit.
We asked Connor Radsteen, Sr. Manager, Carrier Development at Kenco two questions:
No, shippers are not adapting quickly enough to the changes happening in the LTL market. Carriers are investing heavily in their operations to maximize space utilization and improve operating ratios on every shipment. Many LTL carriers now run 70%–80% of their volume through dimensioners by the time freight returns to the origin terminal. As a result, carriers often understand a shipper’s freight characteristics better than the shipper does. That creates pricing and optimization gaps that put shippers at a disadvantage. Shippers need to take a hard look at their current processes because it is no longer a question of if LTL freight will be priced on density, but when nearly all of it will be.
Question 2: Looking Ahead What should shippers prioritize in LTL bids and carrier strategy through year-end?
Question 1: Prediction vs. Current Status At the end of 2025, we expected LTL strategy to depend more on accurate freight data, density, and carrier alignment. Are shippers adapting quickly enough?
Shippers should prioritize data above all else in any bid. Let the data tell the story. Carriers are far more willing to extend pricing concessions when the data is strong, rather than building risk into their pricing to compensate for gaps, assumptions, or withheld information. To strengthen their position, shippers should focus on three key questions: Are we capturing accurate pallet counts and dimensions? Are we capturing all accessorials we actually use, not just the ones we currently pay for? And are we using the correct NMFC code and class? If not, correcting those gaps should be a top priority before the next bid cycle.”
Carrier performance is mixed, and shippers with better freight data have more room to control cost.
Confirmed — LTL is rewarding precision.
LTL pricing would remain disciplined, with density and data quality becoming more important.
Parcel costs are no longer defined by the base rate alone. At mid-year 2026, shippers are seeing continued pressure from fuel tables, delivery-area fees, residential charges, dimensional rules, minimum charges, and in-year carrier adjustments.
IV. Parcel Market
Surcharges Are the New Sticker Price
The opportunity is not simply to negotiate a lower base discount. It is to understand the true cost drivers by package profile, service level, geography, and surcharge exposure before peak season. For shippers, parcel strategy now depends on visibility into the full cost picture. The companies best positioned for the rest of 2026 will be those that can identify where costs are actually increasing, adjust packaging and service decisions, and manage carrier mix before peak-season pressure builds.
U.S. parcel volume: 22.37B shipments, +3.4% YoY
Parcel revenue growth: +2.7%
Estimated cost exposure: actual costs can run 2–4% higher than published GRIs without action
Compare actual all-in cost per package against published GRI assumptions. Audit fuel, delivery area, residential, dimensional weight, and handling charges. Review package dimensions and packaging strategy. Evaluate carrier diversification by region, zone, and service level. Identify service-level changes that reduce cost without hurting customer experience.
We asked Aaron Parsons, Director of Carrier Dev & Parcel at Kenco two questions:
Our prediction has largely been confirmed. Parcel costs continue to rise, but the primary drivers have been accessorials, fuel, dimensional weight, delivery-area fees, and carrier pricing rule changes rather than headline GRIs alone. In 2026, controlling parcel spend is increasingly about managing surcharge exposure, package design, and carrier strategy — not just negotiating better base rates.
Question 2: Looking Ahead Where should shippers look first for savings before peak season?
Question 1: Prediction vs. Current Status At the end of 2025, we expected parcel costs to rise through accessorials and carrier pricing complexity. How has that played out so far?
Before peak season, shippers should start with surcharge exposure, packaging optimization, and carrier/service selection. The biggest savings opportunities are often found by reducing dimensional weight, managing accessorials, auditing invoices, and aligning service levels with actual customer delivery expectations — not simply negotiating lower base rates.
Published increases still do not reflect the full cost impact.
Confirmed — parcel cost control depends on the details.
Parcel would become more expensive and more complex through surcharges and accessorial changes.
V. Warehousing & Inventory
Leaner Inventories, Strategic Buffers
At the end of 2025, inventory strategy was expected to shift from excess to efficiency. At mid-year, that direction is still right — but disruption is complicating the path.
Inventory costs remain high, warehousing prices are elevated, and upstream firms are pulling inventory forward to protect against shortages while downstream firms are staying lean against tariff pressure. The result is a more nuanced inventory environment: shippers want leaner operations, but they still need enough buffer to protect service.
Separate strategic safety stock from slow-moving excess. Review inventory by SKU velocity, margin, seasonality, and service risk. Reevaluate warehouse layout for flow, not just storage. Use forecasting and labor planning to absorb variability where possible. Track inventory, warehousing, and transportation costs together.
We asked Jason Minghini, Senior Vice President of Supply Chain Solutions at Kenco two questions:
The prediction we made at the end of 2025 wasn’t wrong — it was incomplete. The shift is not simply from excess to efficiency. It is from static inventory policy to dynamic inventory posture. Companies are not struggling because they held too much or too little inventory. They are struggling when their inventory position is the result of tariff timing or disruption response rather than a deliberate planning decision. Smarter inventory strategy is no longer about choosing between lean operations and protective buffers. It is about earning the right to be intentional.
Question 2: Looking Ahead What should smarter inventory planning look like through the rest of 2026?
Question 1: Prediction vs. Current Status At the end of 2025, we expected inventory strategy to shift from excess to efficiency. Are companies actually getting leaner, or are disruptions forcing them to hold more stock?
Three things separate the planners from the reactors in the back half of 2026. First, segment buffers instead of averaging them. A single safety stock policy across a portfolio is outdated. Companies should stratify inventory by supply risk, such as supplier concentration, tariff exposure, and lead-time variability, as well as by demand criticality. Hold strategic depth on the SKUs where a stockout could stop a customer’s line, and run lean where the supply base is diversified. Second, make inventory positioning a network decision, not just a warehouse decision. Where inventory is held now matters as much as how much is held. Positioning stock closer to ports and demand density, with the flexibility to reallocate across nodes, turns inventory from a fixed bet into an adjustable one. Third, connect the data before commissioning the algorithms. Everyone wants AI-driven demand sensing, but predictive planning is only as good as the data feeding it. Getting execution-level data out of siloed systems and into a unified layer is the unglamorous work that makes smarter planning possible. The winners in 2027 are doing that plumbing in 2026.”
The shift is happening, but high costs and disruption are keeping safety stock in the conversation.
Confirmed — efficiency matters, but resilience still requires buffers.
Shippers would move from excess inventory toward efficiency, faster turns, and flow-optimized networks.
Shippers want leaner operations, but they still need enough buffer to protect service.
VI. WAREHOUSE Real Estate MARKET
Stabilizing, but Modern Space Matters More
The warehouse real estate market is moving toward balance, but not all space is equal. At the end of 2025, the prediction was that construction would slow, demand would stabilize, and occupier-friendly conditions could tighten later in 2026.
Mid-year data supports that view. Vacancy has eased from its late-2025 peak, net absorption has improved, and new completions have fallen sharply. Demand is also shifting toward modern, automation-ready facilities, which could make the best space more competitive even as the overall market stabilizes.
Review lease expirations and facility needs for the next 12–18 months. Evaluate labor access, transportation access, power, dock configuration, and clear height. Prioritize automation-ready facilities where throughput and labor efficiency matter. Compare total network cost, not just rent. Avoid waiting too long on space that is critical to future network performance.
We asked Kristin Leffew, Vice President Real Estate at Kenco two questions:
That prediction has held up. In Q2 2026, the U.S. industrial vacancy rate stabilized and demand began outpacing supply. These results signal that the U.S. industrial market is trending toward equilibrium.
Question 2: Looking Ahead What should shippers prioritize when planning facility needs for late 2026 and 2027?
Question 1: Prediction vs. Current Status At the end of 2025, we expected industrial real estate to move toward balance. How has that prediction held up at mid-year?
Shippers should focus first on geographic locations that are optimal for the overall network rather than chasing lower-rent markets. The lowest rent does not always create the lowest total cost if the location adds transportation, labor, or service challenges. They should also consider securing a quality facility while the market is still tenant-friendly. There may still be opportunities to negotiate lower rates and stronger tenant improvement packages, creating a better overall value. Finally, shippers should evaluate whether a facility can support future automation. Clear height, slab strength, power availability, dock configuration, and other infrastructure requirements will become increasingly important as companies plan for more automated and efficient operations.
Balance is improving, but modern, automation-ready facilities are becoming more strategic.
Confirmed — the market is stabilizing, but prime space may tighten.
Industrial real estate would stabilize as construction slowed and demand caught up.
U.S. Warehouse Supply: Demand & Vacancy
The chart shows warehouse real estate moving toward balance, with vacancy easing from its peak, demand improving, and new supply slowing as modern, automation-ready space becomes more strategic.
VII. Labor Market
Stability Masks a Skills Shift
The labor marketing is not the same as it was two years ago. The broader market remains stable, but transportation and warehousing employment is still down year over year. That supports the end-of-2025 prediction that the labor challenge would shift from broad shortage to skill specialization.
The question for the rest of 2026 is not only whether companies can hire enough people. It is whether they can develop the skills needed for automation-supported, data-driven, safety-focused operations.
We asked Rebecca Wilson, Senior Vice President of Human Resources at Kenco:
How do you see labor availability and required skill sets evolving in 2026, and what should companies prioritize in their workforce strategies?
In 2026, demand for talent with advanced capabilities in automation, data analytics, AI deployment, and digital platform management will increase significantly. Competition for external talent with these specialized skills will intensify, requiring organizations to focus heavily on workforce planning and invest in upskilling and reskilling existing team members.
— Rebecca Wilson, Senior Vice President of Human Resources, Kenco
Kenco Insights for 2026
What this means for shippers in 2026
Labor strategies will shift toward skill specialization rather than workforce size. Companies that invest in workforce development and internal capability-building will be best positioned to support increasingly automated operations.
2026 Guidance for Shippers
Canada Labor Watch: Softer Hiring, Slower Wage Growth
Canada’s labor market has cooled, not collapsed. Employment swings have become more volatile, unemployment reached a 17-month high earlier in 2026, and demand conditions remain restrained. For supply chains, that points to a more cautious Canadian market with slower consumer demand, less wage pressure, and continued implications for cross-border planning.
Identify roles becoming more technical or data-driven. Build upskilling plans for automation, analytics, safety tech, and digital tools. Cross-train associates for flexible labor deployment. Align technology rollouts with training and change management. Track retention, safety, productivity, and engagement together.
We asked Rebecca Wilson, Senior Vice President of Human Resources at Kenco two questions:
Yes, we’re seeing that shift happen, although it varies by role and market. While labor availability for many frontline warehouse positions has generally improved, the challenge has increasingly moved toward finding and retaining employees with specialized skills. Demand is growing for workers who can operate and maintain automated equipment, work effectively with WMS and other technology platforms, analyze data, manage inventory complexity, and oversee increasingly sophisticated logistics operations.
Question 2: Looking Ahead What workforce capabilities should shippers prioritize through the rest of 2026?
Question 1: Prediction vs. Current Status At the end of 2025, we expected logistics labor challenges to shift toward skill specialization. Are you seeing that happen?
As automation and AI become increasingly prevalent across logistics operations, shippers should prioritize upskilling their existing workforce. Employees need the technical skills to support, adapt to, and fully capitalize on these technologies as they become more embedded in daily operations.
The broader labor market is steady, but supply chain roles are becoming more technical.
Confirmed — workforce strategy is moving from headcount to capability.
Labor constraints were expected to shift toward specialized skills in automation, analytics, AI deployment, and digital systems.
Labor Market Update: Nonfarm Payroll Employment Chart
The chart shows a resilient but uneven labor market, with overall payroll gains holding steady while transportation and warehousing employment remains softer year over year.
Canada’s labor market is showing clearer signs of cooling in 2026. Monthly employment gains have become more uneven, unemployment moved higher through late 2025 and early 2026, and overall labor conditions are softer than they were a year ago.
VIII. Innovation, Automation, & AI
From Pilots to Practical Impact
The end-of-2025 report predicted that automation would move from experimental to essential. At mid-year, that prediction is accelerating — but with a more practical lens.
AI-Enabled Vision Systems
Investments surged in AI-powered quality and safety tools: Protex AI for real-time safety monitoring Kargo Towers for automated pallet verification and label capture
Digitization & Control Towers
RPA, mobile applications, and visibility platforms (such as Stratos) accelerated data-driven decision-making. Automation moved from experimental to essential as companies sought efficiencies during an uncertain year.
The strongest technology conversations are no longer about what is exciting. They are about what improves accuracy, safety, visibility, throughput, labor efficiency, and compliance. AI is following the same path: its strongest value is not just collecting more data, but helping teams make faster, better decisions.
We asked Ainsley Williams, Vice President of Automation & Innovation at Kenco two questions:
At the midway point of the year, we’re seeing some of the clearest ROI from AI’s ability to help operations move from a reactive model to a proactive one. By analyzing historical performance, market trends, demand patterns, and network readiness, AI can help organizations anticipate inventory and labor needs before they become operational challenges. Applications such as predictive slotting, dynamic inventory reassessment, and order trend forecasting allow facilities to prepare for peak periods more effectively, reducing the need for costly last-minute labor increases. Ultimately, automation delivers its greatest value when operations are stable and predictable, and AI is proving to be a powerful tool for creating that consistency. It enables automation systems to operate at peak efficiency while improving overall operational performance.
Question 2: Looking Ahead How should shippers decide which AI, automation, or robotics investments are worth pursuing through the rest of 2026?
Question 1: Prediction vs. Current Status At the end of 2025, we predicted automation and AI would become more essential. Where are companies seeing the clearest ROI at mid-year?
Shippers should start with a clear understanding of the problem they are trying to solve, while also recognizing which existing processes and technologies are already delivering value and should remain part of the future-state operation. Successful automation is rarely a direct replacement for a manual process. It often requires organizations to rethink workflows and embrace new ways of operating. A shipper’s willingness and ability to transform processes will heavily influence which solutions make the most sense. In some cases, targeted technologies such as AI-driven planning tools, robotics, or other point solutions can augment existing operations and deliver meaningful value without requiring a complete network redesign. For others, a more comprehensive transformation may be justified. Operational readiness is a cornerstone of automation success. Organizations that honestly assess the maturity of their processes, data, labor management practices, and change-management capabilities are far more likely to select investments that deliver sustainable ROI. The best technology is not necessarily the most advanced, but the one that aligns with the operation’s needs, readiness, and long-term business strategy.
Adoption is accelerating where technology solves a clear operational problem.
Accelerating — especially around visibility, accuracy, safety, and decision support.
Automation and AI-enabled tools would move from pilots to scaled, practical deployments.
AI is moving from visibility to decision support. The best use cases help teams reduce errors, identify risk, improve safety, plan labor, and act faster.
Start with the operational problem, not the technology. Define ROI before launching a pilot. Prioritize tools tied to accuracy, safety, throughput, labor efficiency, or visibility. Include frontline users early in testing and rollout. Build a pilot-to-scale plan before investing heavily.
IX. Final TakeawayS
The Rest of 2026 Will Reward Prepared Shippers
The first half of 2026 has not delivered a clean recovery, but it has created a clearer picture of what shippers need to manage. Costs remain elevated. Capacity is tightening in select areas. Inventory strategy is more complicated. Industrial real estate is stabilizing, but modern space matters. Labor is steady, but skills are changing. Parcel remains complex. Automation and AI are moving from future-state concepts to practical tools.
The strongest takeaway is that the market is forcing discipline. Shippers are managing more than freight rates and warehouse costs — they are also facing growing pressure from tariff absorption. For many companies, absorbing those added costs is becoming a real pinch point, and by the end of 2026, some may have to decide whether to pass those costs on to an already strained consumer. Shippers still have room to act, but the advantage will go to companies that move before conditions change again. The rest of 2026 will reward organizations that use data, partnerships, network planning, and targeted technology to protect flexibility, manage cost exposure, and make smarter decisions before pressure turns into reaction.
Final Guidance for Shippers Mid-2026
Strengthen carrier, parcel, supplier, and real estate partnerships before conditions tighten.
7 Moves Shippers Should Make Before Year-End
Reforecast demand, cost, and service assumptions for the rest of 2026.
Audit freight, parcel, and inventory data to uncover avoidable cost.
Build resilience into inventory, sourcing, and transportation plans without overcorrecting.
Prioritize AI and automation projects with measurable cost, service, safety, or accuracy impact.
Build scenario plans for tariffs, geopolitical disruption, fuel volatility, and supplier risk.
Avoid waiting for certainty before making controllable improvements.
I. Market Overview II. Transportation Market III. LTL Market IV. Parcel Market V. Warehousing & Inventory VI. Warehouse Real Estate Market VII. Labor Market VIII. Innovation, Automation & AI IX. Final Takeaways X. Kenco Updates About Kenco
X. About Kenco / Kenco Updates
Building What the Market Now Requires
As the market recalibrates, Kenco continues investing in the capabilities, partnerships, and technologies customers need to operate with more flexibility, visibility, and control. In 2026, that momentum includes expanded work across distribution, service parts, MHE maintenance, refrigerated distribution, and plant support — all focused on helping customers adapt faster in a changing supply chain environment.
Kenco is also continuing to build for what comes next. With the grand opening of the Kenco Innovation Lab in Chattanooga, customers now have a hands-on space to explore automation, robotics, AI-enabled safety, visibility tools, and fulfillment technologies designed to solve real operational challenges — not just chase the next trend. These investments are backed by meaningful recognition, including Great Place to Work® Certification, P&G naming Kenco its 3PL of the Year, and Kenco moving up to the No. 3 spot on Inbound Logistics’ Top 10 3PL list. For customers looking for a partner that can bring operational discipline, practical innovation, and proven performance together, Kenco is ready to help build a smarter, more resilient supply chain.
What’s New at Kenco: New Business / Industry Recognition
Kenco is a "Great Place to Work"
P&G Names Kenco 3PL of the Year
We asked Connor Radsteen, Sr. Manager, Carrier Development at Kenco Group two questions:
No, shippers are not adapting quickly enough to the changes happening in the LTL market. Carriers are investing heavily in their operations to maximize space utilization and improve operating ratios on every shipment. Many LTL carriers now run 70%–80% of their volume through dimensioners by the time freight returns to the origin terminal. As a result, carriers often understand a shipper’s freight characteristics better than the shipper does. That creates pricing and optimization gaps that put shippers at a disadvantage. Shippers need to take a hard look at their current processes because it is no longer a question of if LTL freight will be priced on density, but when nearly all of it will be.”
Ana Elena Marziano Chief Purchasing Officer, P&G
felt welcomed when they joined Kenco.
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believe they're trusted with responsibility in their roles.
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of Kenco employees say this is a great place to work, compared to 57% at a typical U.S.-based company
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Whether driving operational agility, pioneering new technologies, or elevating end-to-end sustainability, Kenco has delivered measurable impact that directly benefits the consumers we serve.
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About Kenco
Kenco helps customers navigate complex supply chain environments through integrated logistics solutions, engineering expertise, transportation management, MHE services, automation guidance, and data-driven supply chain solutions. As market conditions continue to shift, Kenco remains focused on helping shippers build supply chains that are more flexible, efficient, resilient, and ready for what comes next. Visit Kenco at KencoGroup.com
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I. Market Overview II. Transportation Market III. LTL Market IV. Parcel Market V. Warehousing & Inventory VI. Warehouse Real Estate Market VII. Labor Market VIII. Innovation, Automation & AI IX. Final Takeaways X. About Kenco / Kenco Updates
