What is Shrinkflation - examples and how to fight it.
Most people know what is inflation is, but Shrinkflation is a little less known. In its simplest form, shrinkflation is when corporations reduce the number of items in a package or the size/weights of the items being sold – yet the price is the same and not reduced accordingly. In effect, the customer is paying the same amount for less product. Find examples of shrinkflation below, learn what to look out for and how to avoid it.
Consumers are very aware that their dollars buy less now than they could purchase a year ago. In part, that's due to inflation. Inflation is simply a decrease in the purchasing power of a specific currency, such as a dollar, over time. Simply put, it means you're paying more for the same item compared to what you paid a year ago. Shrinkflation is another reason that your dollar can’t buy the same among of stuff as it did in the past. Shrinlfation is in effect when a corporation sells you less stuff (groceries, prepared food, etc.) at the same price.
Inflation vs. Shrinkflation
You always get 12 eggs in a package of a dozen eggs. A gallon of gas is always four quarts. Prices for eggs and gas have substantially increased in recent years due to manufacturing costs and supply chain issues. When the quantity of a product cannot be changed, the only option for producers is to raise the price. These are examples of inflation. A dollar simply does not buy as many eggs or as much gas as it did several months ago.
Inflation is not the only economic phenomenon hitting consumers in the wallet. Shrinkflation has become increasingly evident on grocery store shelves. Shrinkflation occurs when package sizes are made smaller or the number of items in a package is reduced while prices remain the same or jump only slightly. The result is that you get less product for your dollar.
Shrinkflation has been around since the 1960s. One story suggests it began with candy manufacturers who had to deal with rising costs. Since vending machines limited the types of coins that could be deposited, manufacturers began shrinking the size of the product so that the price of a 10-cent candy bar could remain a dime.
Shrinkflation generally occurs in waves but tends to be more widespread when inflation rates are high. With inflation hitting multi-year highs recently, the phenomenon of shrinkflation is affecting more products.
Labor shortages, higher prices of raw materials, and increasing transportation costs due to supply chain issues and/or high gas prices have combined to make everyday goods more expensive to produce and get to market. To maintain profits, manufacturers can either raise the price of an item or reduce the amount of the product while charging the same price.
Examples of Shrinkflation
Consumer advocates often brand shrinkflation as a sneaky method manufacturers employ to maintain their profit margins without risking a consumer backlash. The average shopper usually notices a product's price increase but will not immediately be aware of a small change in package size or the net weight of the contents. Manufacturers count on consumers to keep buying their products without realizing they are getting less.
Shrinkflation can be discovered in almost every aisle of your favorite grocery store. Paper products are frequent targets for downsizing, as are snack foods and personal hygiene products. Some specific examples of shrinkflation are as follows:
Charmin has reduced its Mega and Super-Mega toilet paper rolls by 30 sheets. Cottonelle's Mega Rolls now have 312 one-ply sheets instead of 340 sheets. If you buy an 18-roll pack, that amounts to losing more than an entire roll. A roll of Bounty 2-ply paper towels that once contained 138 half-sheets now provides 110 half-sheets.
Gatorade is frequently cited as a prime example of shrinkflation for reducing bottles from 32 to 28 ounces without changing the price. Consumers may not have immediately noticed the change. The height of the new bottle remained the same but the middle of the bottle was narrowed to eliminate four ounces. Rather than blaming inflation for the change, Gatorade claimed it wanted to make the bottle more ergonomically friendly.
Cookies and potato chips are routinely downsized. A package of Keebler's Chips Deluxe with M&Ms has been reduced to 9.75 ounces from 11.3 ounces. A party bag of Lay's potato chips recently shrank by more than two ounces. Doritos recently eliminated five chips from its 9.75-ounce bag, making it 9.25 ounces.
Shrinkflation is also widespread among health and hygiene products. Crest's 3-D whitening toothpaste tube is now 3.8 ounces instead of 4.1 ounces. Pantene Pro-V conditioner that used to be packed in a 12-ounce bottle now comes in a 10.4-ounce tube. Dove Body Wash dropped from 24 to 22 ounces. Aleve's 100-caplet bottle now contains 90 caplets.
It's now common to discover fewer plastic zip bags or dryer sheets in a package, fewer oatmeal packets in a box, and fewer potato chips in a bag. Shrinkflation has also affected orange juice, laundry detergent, cereal, peanut butter, and the size of soap bars.
Restaurants and fast-food outlets have jumped on the shrinkflation bandwagon. Subway's chicken wraps and sandwiches contain less meat. The boneless chicken wing carryout deal at Domino's Pizza has been downsized from 10 to eight wings. Similarly, Burger King's previously 10-piece chicken nugget meal now contains eight nuggets. With the rising cost of beef, the Whopper is no longer listed on BK's Value Menu.
How to Fight Shrinkflation
The combination of rising prices and shrinking packages is a double whammy for consumers. By changing a few buying habits and paying closer attention to frequently purchased items, consumers can reduce the impact of shrinkflation.
Rather than simply reviewing the price of an item, use what is known as “unit-pricing”. Compare and/or memorize the unit cost that can usually be found in very small letters on the shelf label near the product. By comparing the price per ounce or unit, such as 100 sheets for paper products, you can more easily tell which product gives you more for your dollar. Learn more on how to find unit price.
Increase the use of digital coupons, review weekly store ads, and be more conscious of sales. There are free smartphone apps that provide coupons, deals, and savings, which can help offset any price increases from inflation or even shrinkflation. Read more on the most effective grocery coupon apps.
Shop for products that avoid shrinkflation, and try to do this at more than one outlet if you have multiple grocery stores nearby. Prices for the same item will frequently vary by 10-20% from one store to another. Shopping online makes it easy to compare the prices of items where you regularly shop or between stores.
Try charities, including food pantries or clothing closets, for free stuff. Try to offset shrinkflation with some critical items from a charitable pantry, if you are in a financial crisis. Maybe some free ingredients, household or personal items, or other goods can be found. Find a free bank or drive thru pantry near you.
Consider buying alternative brands. Or try store brand items. Most stores provide similar products from multiple companies and very often manufacture a store brand as well. Store brands are usually the last to be impacted by shrinkflation. Even try free stuff near you from Craigslist and other sources.
Buy in bulk. The per-ounce or unit cost of an item is usually lower when buying items in bulk. For example, you'll typically pay less for each paper towel sheet if you buy a 4-pack rather than a single roll. When buying food items, just be sure you'll be able to consume the bulk purchase before the expiration date on the package to avoid throwing unused items out.
A high inflation rate is expected to persist for the foreseeable future, so product downsizing will likely become more widespread, impacting even more products. Becoming a smarter shopper and making a few changes in your shopping routine will help you combat shrinkflation and get the most out of your hard-earned dollars.
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