Shrinkflation

In economics, shrinkflation is the process of items shrinking in size or quantity while their prices remain the same.

Economic definition

Shrinkflation is a rise in the general price level of goods per unit weight or size, with a corresponding reduction in the weight or size of the item sold. Hence the price of the packaged product remains the same. This does not affect inflation measures such as the consumer price index or Retail Price Index, because there is no increase in the cost of a basket of retail goods and services.

Examples of shrinkflation

• In 2009 Mars reduced the size of their Mars bar from 62.5 grams to 58 grams, while the price remained at 37 pence.
• In 2010 Cadbury reduced its 200 g Toblerone bar to 170 g.
• Tetley tea bags were sold in boxes of 88 instead of 100.
• Nestlé reduced its After Eight Mint Chocolate Thins box from 200 g to 170 g.
• Cadbury's Crunchie were sold in packs of three instead of four.
• In 2013 Cereal Partners sold Shredded Wheat Superfruity for £2.68 at Sainsbury's; was put on £2 special offer, before returning to £2.68, but with less cereal in each box.
• In January 2009 Häagen-Dazs announced that it would be reducing the size of their ice cream cartons in the US from 16 US fl oz (470 ml) to 14 US fl oz (410 ml).
• In 2014 Coca-Cola reduced the size of their 2-litre bottle to 1.75 litres

See also

• Purchasing power
• Real versus nominal value (economics)
• Deflation