In Joe Biden’s America, getting less is happening a whole lot more. The economist’s label for what’s happening to product after product is...
In Joe Biden’s America, getting less is happening a whole lot more.
The economist’s label for what’s happening to product after product is called “shrinkflation.”
It takes place when inflation of the kind Biden’s team said was transitory until it wasn’t starts making all the raw materials in a product cost more. Rather than make consumers pay more for the same amount of a product – something no one likes – some manufacturers reduce the size of what they sell while holding the price steady.
For example, Frito-Lay has acknowledged that the 9.75-ounce bag of Doritos is now 9.25 ounces, a reduction of five chips, according to the business news website Quartz.
Other companies, such as Proctor & Gamble, Mondelez — which makes Nabisco Wheat Things — and Pepsi have taken similar measures, Quartz reported.
“Inflation is hitting everyone … we took just a little bit out of the bag so we can give you the same price and you can keep enjoying your chips,” a Frito-Lay told Quartz.
“Downsizing comes in waves, and it tends to happen during times of increased inflation,” Edgar Dworsky, a consumer rights lawyer, told Quartz.
“Bottom lines are being pinched and there’s three basic options: raise the price directly, take a little bit out of the product, or reformulate the product with cheaper ingredients,” he said.
Dworsky said consumers are most easily fooled when they get less stuff for the same price because of inflation.
“Downsizing is really a sneaky price increase,” Dworsky said, according to a July report for NPR‘s “Planet Money.”
“Consumers tend to be price-conscious. But they’re not net-weight conscious. They can tell instantly if they’re used to paying $2.99 for a carton of orange juice and that goes up to $3.19. But if the orange juice container goes from 64 ounces to 59 ounces, they’re probably not going to notice.”
Jamie Stone a packaging design expert at PA Consulting, told Quartz that giving consumers less for the same money requires effective packaging.
“You need to get rid of the oxygen or redesign the packaging,” he said.
It is also not something companies do lightly if they think inflation is, shall we say, transitory.
“How many millions do you need to spend on the capital, the design, the supply chain, to make a package slightly smaller? If the commodity price is reversed and everything goes back, you may have wasted your money,” Stone told Quartz.
Price increases are a last resort, Mark Cohen, director of retail studies and adjunct professor at Columbia University’s business school, said, according to WDSU-TV.
“For consumer products companies, raising prices for consumers is the last resort. That’s because price increases in stores are highly noticeable by shoppers and can influence demand,” he said
“For consumers, this is kind of an annoyance…. or a concern depending on the product we’re talking about,” Cohen said. “I do believe inflation will be here for a while and we will see such product adjustments continue to happen.”
In the July “Planet Money” report, NPR’s Greg Rosalsy looked into the long-range future as what was then supposedly transitory inflation was eating into Americans’ paychecks.
“If this keeps up, maybe someday we’ll all be living in a Lilliputian dystopia where we’re forced to eat miniature candy bars, drink tiny drinks, and wipe our bottoms with teeny-tiny squares of paper,” he wrote.
“Or maybe consumers will start to notice and voice concern and the power of consumer demand will force companies to listen and right-size their products. Until then, our prayers are with the lovers of Cocoa Puffs,” he wrote.
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