Why ‘Shrinkflation’ Means You Are Paying The Same For Less

According to multiple retail experts, many products’ prices are rising globally right now, but instead of raising them, many retailers are shrinking their product sizes. This is what people call “shrinkflation.”

It is obvious that with inflation, prices on everything from groceries to fuel are rising worldwide. ‘Shrinkflation‘ is a term that refers to the technique of countering inflation by shrinking the size of a packaged item while retaining its price.

What Is Shrinkflation?

The term “shrinkflation” is a combination of the terms “shrink” and “inflation.” It is a term that refers to the practice of shrinking a product while keeping its price constant.

Does it apply to all products?

Numerous surveys suggest that shrinkflation will most likely occur in packaged consumer items in 2022, such as beverages and snacks in boxes. Napkins and hand towels may also include.

Multiple major corporations in different industries throughout the world use this technique to make changes that go unnoticed.

The majority of firms are not required to maintain the same size or number of products, as there is no legal requirement.

How does shrinkflation work?

A product’s size can be lowered by a small percentage, such as 5%. The majority of people are unlikely to notice. However, if the same corporation reduced the size of their goods by 50%, customers would immediately notice.

As a result, the adjustments will be little, but when distributed across multiple items, a corporation can save a lot of money.

If you’re looking for a good deal, retail consultants advise you to consider the total cost of each item rather than just the retail price. Keep track of the cost of each unit.

Why does shrinkflation happen?

Because businesses must pay a higher price for supplies, they may try passing that expense on to the consumer. Manufacturers can save money by downsizing their products.

Consumers may overlook minor changes in packaging or fail to read the small print regarding the size or weight of a product since they are focused on the price.

If the price remains constant, people are far less likely to realize that they are receiving less. Downsizing occurs in waves throughout history, and it is most frequent when there is a lot of money in the world.

A manufacturing company can attempt to save money in three major ways:

  • Raise the price.
  • Cut a little out of the product.
  • Change the recipe to use cheaper ingredients.

Generally, businesses do not want to increase the price of a product directly in order to keep customers satisfied.  Additionally, they wish to maintain their prices as low as possible in comparison to their competitors.

Not all increases in the size of a product are profit-driven. Product sizes may change as a result of new regulations limiting the number of calories or sugar allowed in a food item.


Examples of shrinkflation

Some products that downsized in 2021:

Why ‘Shrinkflation’ Means You Are Paying The Same For Less
Photo: Quartz


If this trend continues, we may all be forced to live in a Lilliputian dystopia where we must eat minuscule candy bars, drink little beverages, and wipe our bottoms with teeny-tiny bits of paper. Alternatively, customers may become aware and voice their concerns, compelling businesses to listen and appropriately size their products.