As inflation bites, US companies shrink product sizes

NEW YORK • More air in that bag of chips? Fewer flakes in your cereal box? You're not imagining it. "Shrinkflation", a tactic used by industry to hide price increases, is back in vogue.

Facing the post-pandemic inflationary surge, partly fuelled by bottlenecks in global supply and trouble finding workers, companies are under more pressure to deal with rising costs.

Consumer advocate Edgar Dworsky, who has followed the phenomenon he calls downsizing for quarter of a century, says he has identified dozens of products recently that have seen sneaky price rises. He found goods ranging from Charmin toilet paper rolls to Cheerios cereal to Royal Canin canned cat food where the size or weight has shrunk, but the price remains the same.

Last month, food giant General Mills, maker of Cheerios, flagged the soaring costs for materials and labour to justify conventional price increases but also changes to "PPA" - price pack architecture - a technical term for the adjustment of size or quantities. While these small changes in size could pass largely unnoticed in the past, the Internet era puts them in the spotlight. On the social network Reddit, the "Shrinkflation" group has 14,500 members, who share their discoveries, though mostly tongue-in-cheek rather than to protest.

"It's definitely more insidious because shrinkage, at least for me, is less noticeable than a price increase," said Mr Jonathan Khoo. But "it's the delay in finding out you've been played" that makes the tactic worse than a straightforward price hike, said the 44-year-old software designer.

Professor of marketing Pierre Chandon at Sorbonne University's Insead behavioural lab said shoppers feel they have been scammed because "most consumers have a mistaken idea that the quantities are standardised, regulated", which is only true for a few products, with rare exceptions like alcohol.

"Since we assume that the weight is fixed, we do not look at it," Prof Chandon said.

Mr Khoo's fellow Oregon resident Brian Johnson winced when he recently saw that a container of trendy local ice cream brand Tillamook had lost 200 millilitres, dropping to 1.42 litres from 1.65 litres. "I know that companies are doing this because consumers have a price point for items based on years of experience. They expect to buy a container of something within a price range," the 52-year-old data scientist said.

But Prof Chandon sees a silver lining in the health benefits of smaller package sizes. "We know that the more there is, the more we eat," he said, and now "we are returning to what were normal portions not so long ago".

AGENCE FRANCE-PRESSE