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Inflation is doing a number on the economy, and there is no end in sight. We are just now starting to feel the after-effects of business shutdowns, a disrupted supply chain, and an unprecedented increase in the money supply.
The numbers are already quite shocking, and they will continue to rise without a change to modern monetary policy.
But we don’t have to look at economic data to know that the price of everything is rapidly going up. That reality manifests itself in our lives every single day.
The thing is, there’s another type of “inflation” that is occurring in the marketplace to combat rising manufacturing costs. And it’s stealthily affecting your monthly budget, too. It’s called “shrinkflation,” and it’s happening everywhere you look.
Shrinkflation is a tactic that businesses can use to avoid raising their prices during times of high inflation. Essentially, the term describes the shrinking of package sizes and quantities without lowering prices. The word is a combination of the words shrink and inflation, and it was coined for its current use by British economist Pippa Malmgren just seven years ago.
The latest example of shrinkflation comes from Kleenex, which recently reduced the number of tissues in a small box from 65 to 60, while keeping the same price point. But it is far from the first company to adopt this tactic. In fact, shrinkflation is nothing new.
“Shrinking the size of goods is exactly what happened in the 1970s just before inflation proper set in,” Malmgren wrote in her 2015 book, Signals: The Breakdown of the Social Contract and the Rise of Geopolitics .
In times of high inflation, prices aren’t just going up for consumers. Costs are also rising for businesses. As everything becomes more expensive—ingredients, packaging, labor, transportation—companies have to figure out how to handle those rising costs.
If you’ve bought a familiar product in recent years and had the feeling that something was a little off about it, it’s possible you noticed shrinkflation without even realizing it.
“It comes in waves. We happen to be in a tidal wave at the moment because of inflation,” Edgar Dworsky—a consumer advocate and former Massachusetts assistant attorney general who has been documenting shrinkflation on his ConsumerWorld website for years—told the Associated Press.
Chobani Flips yogurts have shrunk from 5.3 ounces to 4.5 ounces. Family-size packages of Keebler cookies used to be 17.2 ounces, now they are 14.6 ounces.
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Proctor and Gamble, the makers of Charmin, decided to make their cardboard tubes larger while making the rolls of toilet paper smaller. Meanwhile, Cottonelle’s Ultra Clean Care toilet paper is down to 312 sheets from 340.
Nabisco changed their family-size box of Wheat Thins from 16 ounces to 14 ounces. A 50-pound bag of Kibbles ‘N Bits dog food is now 45 pounds. Pantene conditioner used to come in a 12-ounce bottle, now it’s 10.4 ounces.
But wait, there’s more! Walmart Great Value brand paper towels went from 168 sheets per roll to 120. Frito Lay shrunk bags of Doritos from 9.75 ounces to 9.25 ounces, and Party Size Fritos Scoops went from 18 ounces to 15.5 ounces.
Hefty’s megapack went from 90 bags to 80 bags. Folgers coffee downsized its 51-ounce container to 43.5 ounces, but they say it still makes 400 cups because of “lighter-weight beans.”
Tillamook decreased the size of its ice-cream cartons from 56 ounces to 48 ounces. General Mills shrunk its “family size” boxes of cereal from 19.3 ounces to 18.1 ounces, while Post cut theirs down from 20.5 ounces to 19.5 ounces.
Gatorade claimed they redesigned their 32-ounce bottle to be “more aerodynamic” and “easier to grab.” But at the same price, the new design holds only 28 ounces.
In an economy with high inflation, it feels like there’s no way for consumers to combat shrinkflation. And the truth is, that feeling is right.
While the Fed tries to come up with new ways to handle inflation without causing more economic damage, prices will continue to go up and companies are going to do everything they can to handle those rising costs. Oftentimes, that will mean shrinking packaging and quantities.
The best thing you can do as a consumer is to be aware of what’s going on and go into your shopping trips well-prepared. Use a grocery price comparison app like Basket when doing your grocery shopping and meal planning.
Change your shopping habits to a more generic brand. Buy in bulk when possible. Buy whole foods instead of pre-packaged products. And pay attention to product labels and the unit price of what you’re buying.
As Utpal Dholakia—professor of marketing at Rice University—explained to Forbes, brands don’t usually shrink all of their items at once. You can still get a good deal if you buy a variation of the product that wasn’t downsized.
You can also try to be more aware of single-use products, and switch to reusable when possible. Making some items at home, like homemade protein bars or investing in a SodaStream if you love sparkling water, can also help with the bottom line.