When you go to the supermarket, you might get an idea of ââhow Alice in Wonderland felt. Your favorite products on the shelves seem smaller than you remember.
Okay, that might be a bit of a stretch, but you certainly won’t go crazy if you notice that a cereal box doesn’t last as many breakfasts as it once did or if your dishwasher pods are smaller.
It’s a sign of the times because inflation has been at an all time high for 40 years, and the companies that make some of your favorite foods, cleaning products, and housewares are seeing their production costs rise as a result.
These companies can pass the costs on to consumers by raising prices. Or they can do something a little more devious: reduce the content of a product to maintain the same price – a phenomenon known as âshrinkflationâ.
Noah Davis, a Seattle-based attorney, said he started noticing an unknown shrinkage about five months ago. It all started with an Amy’s Margherita frozen pizza, which sells for around $ 8, according to the retailer. One pie, which was used to feed three of his children in the past, was only enough for one child, he said.
âYou open the box and there’s this shrunken little pizza inside,â said Davis, 50. Amy did not respond to MarketWatch’s request for comment.
Then he noticed the same was happening with Tillamook orange juice, protein bars, cereal, and ice cream sandwiches, which currently sell for $ 3.99 for a pack of four 3-ounce bars. at Albertsons ACI,
Tillamook did not respond to MarketWatch’s request for comment, but the company noted on Twitter last year TWTR that rising costs had forced him to cut his ice cream sandwiches from 3.5 ounces to 3 ounces, and he posted a blog post explaining his decision to downsize his ice cream products.
““You open the box and there’s this shrunken little pizza inside”“
âWe recently changed the size of our ice cream container, so that we can continue to deliver our beloved extra creamy ice cream to our fans without sacrificing any of the quality components that brought us here,â the site states. Company web.
âSmoke and mirrors,â Davis said.
His experience with smaller and smaller products lately is far from unique. In fact, there’s a whole Reddit thread where users document products they think they’ve shrunk.
This includes Amazon’s AMZN,
House brand dishwasher pods, General Mills Truth Protein Bars, SIG,
Golden Grahams cereals and more.
General Mills did not say whether the portion changes were due to inflation. The company said it was part of an ongoing effort “to create consistency and standardization between our grain products, making it easier for shoppers to distinguish sizes on the shelves,” said Kelsey Roemhildt, spokesperson for General Mills.
âThe majority of the portfolio has undergone changes,â she added.
Truth Bar creator Diana Stobo, who took over the brand in June, said she needed to reduce the bar size from 50 grams to 45 grams in order to remain profitable “because of the rising costs of quality ingredients. “.
But the smaller bars still contain the same amount of omega 3s and probiotics as the 50-gram bars, she told MarketWatch.
Amazon did not respond to MarketWatch’s request for comment.
Shrinkage was a thing in the 1970s
There are cases of shrinkage dating back to the 1970s.
A 99-cent pack of 30 Woolworth pencils in 1973 became a 99-cent pack of 24 crayons in 1974, and gumball makers downsized their candy when the price of sugar rose in the 1970s, according to historian Stephen Mihm.
The downsizing was especially necessary as it would have been more expensive to build new gumball machines to accommodate different parts if gumball makers increased prices.
The Bureau of Labor Statistics takes these big changes into account in its monthly Consumer Price Index report on inflation, said Steve Reed, a BLS economist who oversees the report.
“If the price of a product tracked by the BLS does not change but the size or quantity changes “we will convert the price change to a unit amount”“
To assess the level of inflation that Americans are experiencing, the BLS tracks price changes for a fixed basket of about 80,000 goods and services in 200 different categories.
Items or brands that consumers are more likely to buy than others are given more weight when it comes to calculating the overall change in the price level each month. The same is true for expenses that represent a larger portion of the budget of a typical American household, such as housing.
In doing so, the BLS also keeps track of the size and quantity included for a given product.
So if the price of a tracked product does not change, but the size or quantity decreases, “usually if it is a small change, we will convert the price change to a unit amount”, Reed told MarketWatch.
For example, if a 64-ounce container of orange juice is included in the sample when economists at the BLS are only able to find information on a 59-ounce container for the same price, “that would be calculated. like an 8% price increase â. Reed said.
Despite these efforts, it is impossible to differentiate the extent to which shrinkage drives inflation versus traditional price increases when browsing the CPI report, Reed added.
Price increase vs. shrinkage unknown
If it were up to most companies, they wouldn’t reduce the size or quantity of their products, said Scott Rick, professor of marketing at the Ross School of Business at the University of Michigan.
In other words, they would ideally like to remain profitable at constant price or size for a given product. But in reality, it is impossible.
While the shrinkage “may seem underhand,” said Rick, “it’s not unethical.”
““Just because a box of Cheerios costs $ 4 today, it’s not an eternal commitment to always sell that amount of cereal for that price forever.”“
“It’s not like you’re breaking the terms of a contract.” The same goes for price increases, he said. âJust because a box of Cheerios costs $ 4 today, it’s not an eternal commitment to always sell that amount of cereal for that price forever. “
But when it comes to iconic products like a six-pack or a 12-pack of Coca-Cola KO,
you can be sure that you won’t see a five-pack or an 11-pack of Coke, but an increase in price instead.
Manufacturer of toblerone Mondelez MDLZ,
made this mistake in 2016 when he increased the gap between the chocolate triangles on his candy bar to avoid raising prices due to rising ingredient costs, Rick told MarketWatch.
The move angered consumers who likened the new version to a bike rack, leading the company to revert to the original version of Toblerone two years later.
(Mondelez did not respond to a request for comment.)
How to shop smart with retraction
Chances are, when you go to the grocery store, you don’t have enough time to carefully research each item you buy to see if a manufacturer has downsized a product and, if so, to. How many.
At the same time, having this information could lead you to make better decisions. That’s why Phil Lempert, a food industry expert who founded SupermarketGuru.com, recommends keeping your grocery receipts.
Most supermarket receipts actually show the product name, weight and / or size of the package. And, of course, many packages will give you the price per item or the price per unit weight for you to compare.
When making your shopping list, highlight the items from your old receipts that you plan to buy back. Lempert said he was using it “as a reference to look at what I paid for last time and also the size of the package”.
That’s about the only way to avoid a surprise shrink “unless we have some amazing memories of the size of the package last time around,” he said.