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Research: Here’s How Fuel and Freight Costs are Squeezing Distributor Margins

Half of distributor respondents in the latest Baird-NAW survey reported a margin hit of at least 25 basis points after pricing and surcharge offsets. Here, we show and analyze how much transportation costs are taking out of distributor earnings.

November 3, 2026

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Higher fuel and transportation costs took a bite out of third-quarter operating margins for nearly nine in 10 distributor respondents to the 3Q26 Baird-NAW Distribution Survey. Half reported a headwind of at least 25 basis points, even after accounting for pricing increases and fuel surcharges used to recover those costs.

The findings reflect a difficult quarter for managing delivery expenses. The U.S. Energy Information Administration’s national average retail diesel price rose from $4.955 per gallon in July to $6.291 in September, an increase of nearly 27%. October’s average remained…

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