What is “Shrinkflation”?

June 8, 2022
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“Hidden Inflation”

Amid historic price increases for nearly everything from grocery store items to housing, headlines swirl around the topic of "shrinkflation."
But what does it mean? And why does it matter?

What is Shrinkflation?

“… the practice of reducing the size of a product while maintaining its sticker price.” -Investopedia

  • Some companies employ this practice rather than raising prices, typically in response to a rise in production costs (labor, raw materials).
  • Investopedia describes shrinkflation as “a form of hidden inflation,” noting: “Companies are aware that customers will likely spot product price increases and so opt to reduce the size of them instead, mindful that minimal shrinkage will probably go unnoticed.”
"It [shrinkflation] comes in waves. We happen to be in a tidal wave in the moment because of inflation."

Consumer advocate and former asst. attorney general in MA, Edgar Dworsky. New data recently showed the fastest rise of inflation in more than four decades, with cost increases in nearly every category from food to gasoline — not only month-to-month, but year-over-year. Amid these rising costs, companies come under pressure to maintain profits. Smaller “serving sizes” or a change in packaging may allow companies to maintain profitable margins without directly raising prices at the register.

"Recently, plant food was decreased in size substantially, and even restaurants seem to be changing their portion sizes."

Dworsky, who tracks products which have undergone shrinkflation, shares them on his website mouseprint.org. A variety of items, from General Mills’ Cocoa Pebbles to Charmin’s Ultra Soft “super mega” toilet paper, and even Pantene’s Pro-V Curl Perfection conditioner, have recently undergone decreases in quantity of product. Although the products may look and cost the same, the price per unit is increasing.

Shrinkflation has happened for years but is exacerbated now due to record-high inflation, which reflects the rising cost of goods and services. In a growing economy, we expect to see some increase in prices, but when inflation is too high, our purchasing power drops — and our dollar buys us less (not good for the economy fueled by our spending!). Shrinkflation reflects a “double-whammy” for consumers during this period, as our dollar quite literally doesn’t go as far; we’re either paying higher prices upfront, OR getting less of a product for the same price.

Shrinkflation (Investopedia)

No, you’re not imaging it — package sizes are shrinking (Associated Press)

Smaller Packages, Same Prices: Shrinkflation Is Sneaky (CNET)

Click HERE to hear more from Edgar Dworsky on Shrinkflation (Associated Press; Twitter)

Click HERE to read our Quick Quote on inflation in the U.S.; … new data showing the fastest inflation increase in more than 4 decades.

Here’s a link to Dworsky’s website, where he tracks and shares more about shrinkflation: https://www.mouseprint.org/

by Jenna Lee,

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