---
title: "The Source for December 2025: Inventory Builds, Returns Surge, and 2026 Planning Gets Real "
description: "December 2025 logistics trends: managing inventory surges, planning for massive holiday returns, and preparing for 2026 supply chain strategies."
---

[Source Logistics Blog ](https://blog.sourcelogistics.com)

# [The Source for December 2025: Inventory Builds, Returns Surge, and 2026 Planning Gets Real ](https://blog.sourcelogistics.com/the-source-for-december-2025-inventory-builds-returns-surge-and-2026-planning-gets-real)

 Written by [Source Logistics](https://blog.sourcelogistics.com/author/source-logistics) | Dec 9, 2025 4:03:19 PM

Welcome to **The Source** — your monthly market intelligence from Source Logistics, where we connect logistics trends to operational strategies you can act on today.  

As we close out 2025, three storylines are colliding: 

- Inventories are swelling as manufacturers keep production steady while demand cools. 
- Holiday returns are about to hit in two waves, testing reverse logistics and value-added capacity. 
- Freight, ocean, and industrial real estate remain relatively stable, giving operators space to rethink networks before conditions reset in 2026. 

For Food & Beverage, CPG, Grocery Retail, and Health & Beauty brands, December is less about chasing outbound volume and more about turning data, inventory, and returns into a cleaner, faster start to 2026. 

**Logistics at a Glance – Key Trend Data** 

- **Freight volumes stay soft, costs plateau: **The [latest Cass Freight Index report](https://www.cassinfo.com/freight-audit-payment/cass-transportation-indexes/october-2025) shows U.S. shipment volumes down about 7-8% year over year, with freight expenditures roughly flat year over year after several months of flattish performance. 
- **Truck tonnage slides to a 21-month low: **[ATA’s For-Hire Truck Tonnage Index](https://www.trucking.org/news-insights/ata-truck-tonnage-index-fell-21-october) fell 2.1%, following a 0.8% drop the month before, reaching its lowest level since early 2024, confirming broad trucking softness even as some lanes stay busy. 
- **Ocean rates bounce along the bottom: **After a brief November uptick, [Drewry’s World Container Index](https://www.drewry.co.uk/supply-chain-advisors/supply-chain-expertise/world-container-index-assessed-by-drewry) slipped 2% in late November to about $1,806 per 40-foot container, still near multi-year lows and reflecting weak demand and competitive carriers pricing on key trades. 
- **Manufacturing signals – expansion on one gauge, strain on another: **  
    - [The S&P Global U.S. Manufacturing PMI](https://www.advisorperspectives.com/dshort/updates/2025/12/01/sp-global-manufacturing-pmi-november-2025) eased from 52.5 to about 52.2 in November, still in growth territory but with slower new orders and a record rise in finished-goods inventories. 
    - [ISM’s manufacturing PMI](https://www.reuters.com/world/us/us-manufacturing-slump-deepens-november-2025-12-01), by contrast, fell to 48.2, marking a ninth month of contraction and underscoring tariff-driven cost pressure and uneven demand.
      
      Together these suggest production is holding up, but warehouses are filling with unsold stock – a key backdrop for December’s strategy. 

- **Holiday demand is strong, but returns will be massive: **NRF expects U.S. holiday sales to surpass $1 trillion for the first time, with November-December spending projected to grow 3.7-4.2% year over year. At the same time, retailers anticipate that [roughly 15-17% of holiday sales will be returned](https://nrf.com/research/2025-retail-returns-landscape), with NRF data indicating consumers will send back nearly $850 billion in merchandise in 2025, including about 17% of holiday sales and 15.8% of total merchandise. 
- **Two distinct return waves are now the norm: **As we covered in Source Logistics’ [recent post on the two-wave returns surge](https://blog.sourcelogistics.com/the-hidden-two-wave-returns-surge-that-follow-black-friday-cyber-monday?hsLang=en), brands should expect Wave 1 (Dec. 1-10) after “try it” Cyber Week purchase returns and Wave 2 (Dec. 26-Jan. 15) with the classic post-holiday flood. 

**The Big Picture for December** 

The story for December isn’t volatility – it’s imbalance: 

- Freight and ocean capacity remain accessible. 
- Warehouse vacancy is stabilizing. 
- Manufacturing is still producing, but demand is uneven, and warehouse stocks are at or near record highs. 
- Holiday sales are strong, but returns are poised to erase margin and clog networks for brands that haven’t built out reverse logistics.

For operators, this creates three priorities: 

1. **Turn inventory from risk into optionality. **With warehouses filling up, the advantage goes to brands that can rapidly relabel, re-kit, and reposition stock to chase demand or clear underperformers. 
2. **Treat returns as an inbound replenishment channel, not a post-holiday chore. **Returns strategy in December determines how clean your April inventory position feels. 
3. **Lock in 2026 advantages while the market is calm. **Stable capacity and soft volumes make this the time to renegotiate contracts, test new nodes, and tighten data foundations before conditions tighten again. 

**Operational Insights for December** 

**Warehousing & Distribution** 

*Market Insight: *Manufacturers continue building product even as new orders cool, driving finished-goods inventories toward cycle highs. Industrial vacancy is elevated but likely past its peak. 

*Impact: *Nodes are tightening, and aging SKUs restrict flexibility heading into the returns-heavy January period. Inbound congestion could limit your ability to reposition inventory early in Q1. 

*Recommended Focus: *Redistribute slow-movers to nodes with Value-Added Service capacity and secure overflow & quality control space ahead of Wave 2 returns. Use December to pre-stage inventory for Q1 reset and promotional cycles. 

**Fulfillment & Ecommerce** 

*Market Insight: *Holiday sales remain strong, but up to 17% of purchases will return – split between early December “trial returns” and the post-Christmas surge. Carrier appointments tighten with inbound volume. 

*Impact: *Returns risk slowing replenishment and draining fulfillment labor, while mixed conditions create quality control delays. Outbound speed can deteriorate if receiving isn’t isolated. 

*Recommended Focus:* Segment returns into Wave 1 (rapid restock) and Wave 2 (bulk processing). Dedicate receiving and labor buffers to protect outbound flow and pre-sort SKUs for restock, refurb, or liquidation. 

**Transportation (TL, LTL, Drayage, & Middle Mile)** 

*Market Insight: *Truckload demand is weak and ocean rates remain near multi-year lows. January’s inbound returns will test appointment availability more than linehaul itself. 

*Impact: *Shippers have leverage for Q1-Q2 contract extensions but risk disruption if inbound windows aren’t secured. Low ocean rates offer flexibility for routing experiments before conditions shift. 

*Recommended Focus:* Lock in TL/LTL terms into mid-2026, reserve January delivery appointments early, and use ocean softness to test alternative ports and transload strategies. 

**Value-Added Services** 

*Market Insight: *Elevated inventories and heightened retailer compliance requirements are driving demand for relabeling, repacking, and reconfiguration. Returns add large volumes needing fast disposition. 

*Impact: *VAS capacity becomes the key to salvaging margin on distressed or seasonal SKUs. Without predefined rules, January throughput slows and inventory integrity suffers. 

*Recommended Focus:* Finalized disposition maps by SKU and retailer and build January VAS queues now. Use VAS to reposition or reconfigure slow-movers before Q1 markdown season. 

**Technology, Data, & Compliance** 

*Market Insight: *PMI data shows rising finished-goods inventories and margin pressure, while FDA’s FSMA 204 expectations remain firm. January returns will generate high volumes of condition and disposition data. 

*Impact: *Data silos slow restock decisions and create compliance risk across importer, co-packer, and retailer handoffs. Returns expose visibility gaps faster than standard operations. 

*Recommended Focus:* Run a year-end data cleanup (ASN, SSCC, lots/batches, retailer EDI). Strengthen WMS/TMS/parcel alignment for January inbound velocity and advance FSMA 204 traceability mapping. 

**What’s Ahead for Q1 2026?** 

1. **Inventory Correction Likely: **Sustained production alongside softening demand suggests manufacturers may trim output early in 2026 – reducing inbound volumes and resetting inventory positions. 
2. **Returns Data Will Drive SKU Strategy:** Holiday returns will expose packaging weaknesses, labeling inconsistencies, and SKU complexity. Brands that mine this data will refine assortments faster than competitors. 
3. **Freight Could Move Off the Floor:** If consumer spending stays resilient and inventories rebalance, transportation markets may tighten in the second half of 2026 – making Q1’s calm an important contracting window. 
4. **FSMA 204 Becomes a 2026 Imperative:** Once the compliance extension finalizes, brands will need to accelerate digital traceability. Early movers will avoid the Q4 compliance crunch. 
5. **Network Design Window Narrows:** With vacancy stabilizing and construction slowing, the next 12-18 months may offer the last “tenant-friendly” window for network redesign and multi-temp strategy. 

**Turn Year-End Complexity Into 2026 Momentum** 

December’s mix of soft freight, elevated inventories, and heavy returns is not a challenge – it’s an opportunity. The brands that use this moment to reset inventory, strengthen data, pressure-test networks, and streamline returns will enter 2026 with a decisive operational advantage. 

If you’re planning your 2026 supply chain strategy – from cold chain to omnichannel fulfillment to reverse logistics – [connect with Source Logistics](https://sourcelogistics.com/contact?hsLang=en) to build a unified, forward-looking plan. 

[View full post](https://blog.sourcelogistics.com/the-source-for-december-2025-inventory-builds-returns-surge-and-2026-planning-gets-real)

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