A consumer advocate wants supermarkets to start being a bit more upfront about shrinkflation.
Ian Jarratt, from the Queensland Consumers Association, told The Guardian supermarkets should clearly ticket items that have been reduced in size to shame brands
“Manufacturers use shrinkflation to make sneaky price increases and improve or maintain their margins because most shoppers are more aware of, and sensitive to, higher selling prices than reductions in the amount in packages,” Mr Jarratt says.
And just in case anyone is wondering if Mr Jarrett is just some crank with too much time on his hands, he’s a retired agricultural economist and policy analyst who has an Order of Australia Medal for his work on consumer advocacy. He was instrumental in introducing unit pricing to Australia.
Mr Jarratt wants Australian supermarkets to follow the French supermarket chain Carrefour’s lead and ticket items that have reduced in size.
Consumer awareness
The Carrefour labels say: “This product has seen its volume or weight fall and the effective price from the supplier rise.”
Mr Jarrett said: “Australian consumer awareness of ‘shrinkflation’ and ability to make well-informed choices would be greatly increased if Australian supermarkets did the same.”
When The Guardian contacted Coles and Woolworths, Coles did not reply and Woolworths said it was up to the manufacturer to inform consumers.
There are two barriers to supermarkets introducing such measures. They would dearly love to blame the manufacturers, but would probably suffer a backlash as many of their home brands are made by those same manufacturers.
And, they don’t care.
Power transfer
As sale strategist Bronwyn Thompson told The Guardian, the supermarket duopoly means the power balance has deeply tipped in the retailers’ favour. She says some manufacturers have had to resort to shrinkflation because Coles and Woolworths would not pass on price increases.
“Some suppliers are just not able to pass through price increases any other way,” said Ms Thompson.
“There’s been a massive margin transfer over the last 20 years from suppliers to Coles and Woolies.”
Quick reminder, Coles declared a $1.1 billion profit this year and Woolworths posted a $1.62 billion profit.
The Australian Food and Grocery Council recently said in a submission to a parliamentary committee that the leading supermarkets used their market power to impede suppliers from passing on rising production costs.
Fall in quality
Everyone has seen at least one of their favourite products shrink before their eyes. It’s frustrating and insulting, as if we don’t notice we are being ripped off?
A quick online search very quickly yielded a great number of Australian products ‘shrinking’, including major brands such Mars bars, Kellogg’s cereals, Arnott’s biscuits including Tim Tams, Bega peanut butter and Smith’s chips.
That doesn’t even include poorer quality ingredients, something that Arnott’s has suffered from for years. Monte Carlos seem to have halved in size over the past decade and Iced Vo Vos were once puffy little treats. They are nothing more than flat disappointments now.
A good indication that a product has been ‘shrunk’ or is about to be shrunk is new and improved packaging or branding.
Has one of your favourite products been the subject of shrinkflation? Did you change your buying habits or just suck it up? Why not share your opinion in the comments section below?
Also read: Eight myths about mince you shouldn’t believe
This is a deceptive and dishonest practice. Laws need to be introduced to force manufacturers to indicate clearly that a product has been reduced in size, whatever the reason. I’ve been in situations where I’ve bought products that have been sneakily reduced in size or weight, only to find there’s not enough and I have to go back and buy more.
Yep, once an item has the same cost for less of the product or starts producing lower quality for more money or otherwise provides less value for my hard-earned money, I don’t buy it. Non-essentials have proved easy and cheaper to make myself at home. I make my own cleaning products too. Snack products are easy to make at home as well. The costs of shopping for myself have reduced by more than $100 per week and power costs have increased only slightly so it’s well worth it.
Where consumers have become reliant on a certain product and weight from a given pack design ,it is deceptive practice to then change the contents of the pack without notice.
If it transpired that service station’s Billboard advertised prices were for 800ml and not a litre, Fair Trading and the ACCC would outlaw them pretty quickly.
The law needs to change to put the responsibility on both manufacturers and retailers jointly.
A very deceitful act to con and money gouge the public.
Remember the Mars Bars being reduced from 60g to 57g and maintaining the same price. An 11.7% reduction in product.
And what was the BS spin from the PR department. “In May 2009, the Mars bar size reduced from 60g to 53g in Australia, citing portion sizes and the obesity debate as the primary driver”
Not more profit but looking after our well being. rofl.
What the Supermarkets need to do, is HIGHLIGHT the Price per Gram of the Product.
Therefore if the Weight goes down and the Price stays the same, then the Price Per Gram Will Increase.
The Price of the item is in Large Font, but the Price Per Gram is in Relatively Small Font, making it hard to read.
Woolworths own Pane di Case bread does not even have weight on the whole loaf
It certainly pays to read the labels for expiry or best before dates, and the weight for a start. What I find really sneaky, low down and deceitful is the ‘e’ symbol next to weight.
It is common practice for the contents of a product to be reduced in size and increased in price (or at the minimum price maintained).
The e (for estimated) quantity; e.g. e250g lets the manufacturer, usually, put less into the container – and most products today show the quantity as e…..
Always check the small print on the supermarket labels for price for mls or price per grams as these are what one should be keeping an eye on.
And yes, I agree with one the below comments, that when a product packaging or design changes so does the price.