Consumers are aware that inflation has caused the prices of some of our favorite grocery items to spike in the wake of COVID-19. But what you may not realize is that while groceries are going up in price, in some cases, their sizes are also shrinking. The phenomenon is known as "shrinkflation" and while most shoppers don't examine their cereal boxes or ice cream containers, the fact is they may be paying the same amount — or in some cases, even more — for less product.
Also known as downsizing, shrinkflation can hit your wallet hard, if you're not an informed consumer.
"Downsizing is the reduction in the size of a product — making the package smaller — instead of simply raising the price directly," said Edgar Dworsky, founder and editor of Consumer World in an email to TODAY Food. "It is a backdoor price increase." Dworsky said that the downsizing of products comes in waves, usually as a result of inflation. "Manufacturers tell me when they face increased costs of raw materials or the price of gasoline goes up making it more expensive to ship their goods to the store, they are under pressure to either raise prices or downsize their products. And sometimes they may do both."
Dworsky said that downsizing is an "equal opportunity tactic" used by companies small and large.
"Tillamook, a farmer-owned company, finally gave in and downsized their ice cream from 56 oz. to 48 oz. — some 13 years after Breyers did (a Unilever company)," said Dworsky. "Generally speaking, the big paper manufacturers have been the most prolific downsizers changing the size of paper towels, toilet paper, tissues, etc. repeatedly for decades."
Before you resign yourself to less ice cream, Dworsky said there are some thing we can do to save our hard-earned dollars.
"Shoppers can do three things," he said. "1. If their favorite brand downsizes, look for a competitor that has not yet done so. And if all the brands are downsizing, check the store brand— it is usually the last to shrink their products. 2. Use unit pricing— the price per measure or count labels on store shelves. It helps you compare the price per ounce or per 100 sheets (for example) of differing brands and sizes of the same item. 3. Become net weight conscious. Learn the net weight of the products you regularly buy. Memorize them. And when you shop, check the net weight to make sure it has not changed."
And while both inflation and shrinkflation are likely now happening in response to the changes in the world as it reopens, Dworsky says it's a trend that has been "going on for decades and is not about to stop."
"It does come in waves however, usually in times of inflation," Dworsky acknowledged. "Some products get downsized so much that manufacturers re-introduce larger versions of the product, but at much higher prices. This happens with snack foods like potato chips. The old 16 oz bag becomes 14 oz, then 12, then even smaller. Eventually manufacturers re-introduce one pound bags and call them 'party size.' Another example, toilet paper has been downsized so much, that a number of years ago, manufacturers introduced double rolls and triple rolls and mega rolls and now even super mega rolls — all of which are still smaller than, say original Charmin of the 1960s which had 650 sheets on a roll."
Jayson L. Lusk, a distinguished professor and head of the Department of Agricultural Economics at Purdue University told TODAY that he hasn't seen any data suggesting that "shrinkflation" is occurring at a greater or lesser rate today than in the past.
"Shrinkflation involves firms keeping the price per package the same while reducing package size. However, as long as one converts to price per ounce, the inflation is again apparent, and many grocery stores make this calculation for consumers, albeit in small font, on the store shelf."
Lusk said that when seen in this light, any of the “normal” factors that lead to food price inflation can lead to “shrinkflation.”
"Generally, one would expect an increase in raw ingredient prices, or prices of packaging material, wage rates, or costs of transportation lead to an increase in price per ounce," he said.
The only upside to this predicament is that it may be saving you some calories. When 6-packs of bagels go from 24 oz to 22 to 20 oz, you probably will still buy the same number of packages but eat a little less.
"For small bags of candy that have been downsized, you are not likely to eat two bags instead," said Dworsky. "But for orange juice, cereal, paper towels, toilet paper, peanut butter, whatever — consumers just have to buy it more often."