How Does Shrinkflation Work?

Shrinkflation is when brands downsize their products while keeping their prices the same -- thus passing inflating costs on to you. Learn more in this episode of BrainStuff, based on this article: https://money.howstuffworks.com/shrinkflation-news.htm

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Episode Transcript

Speaker 1 (00:01):
Welcome to brain Stuff, a production of iHeart Radio. Hey
brain Stuff, Lauren Vogelbaum Here, pardon the personal question, but
have you noticed that you're going through rolls of toilet
paper faster than usual? There's a good reason for that.
A toilet paper rolls are shrinking. In the past couple

(00:23):
of years, major brands have reduced the number of individual
sheets on each toilet paper roll. The packages still contain
the same number of total rolls, but each role is slimmer.
Sharman's Mega roll shrunk by seven point a, Kirkland Signature's
rolls dropped by ten point and Angelsoft's Mega Roll plummeted

(00:43):
by reduction. However, the manufacturer said that it thickened the
sheets at the same time. So but while there are
fewer sheets per role, the price per role has remained
the same. Welcome to the infuriating world of shrink flation.
Shrink Flation is a simple economic concept. Inflation rates are

(01:07):
high around the world right now, which means manufacturers are
facing higher prices for raw materials, ingredients, packaging, shipping, and more.
To continue to make the same profit, companies have two options.
Either raise the price of their products or charge the
same price for less of the product. Brands know that

(01:28):
consumers are price sensitive, a meaning that they're likely to
notice when the price of a frequently purchased item like
toilet paper goes up. But what kind of consumer would
notice if their meta rolls of toilet paper were just
eight per thinner, especially if the packaging and branding were
otherwise unchanged. One Edgar dwarf Ski would notice a dwarf

(01:50):
Sky is a consumer lawyer and the genius behind the
consumer advocacy websites consumer World and mouseprint dot org, where
he maintains a long list of products that have fallen
victim to shrink flation. For the articles episodes based on
hos to work spoke with him. He's been tracking shrink
flation for decades, but says that there was a rash

(02:11):
of products that shrunk due to manufacturers grappling with record
high inflation. Recently, the CEO of Kellogg claimed that when
his company makes a product smaller, they also lower the price,
but dwarf Sky has identified hundreds of examples of brands,
including Kellogg's Keebler line of cookies, charging the same or

(02:33):
more for smaller products. Dwarsky said no company would go
through the increased cost of retooling their manufacturing plant and
redesigning the package. If they just didn't exact proportional drop
in the number of ounces in the price, it doesn't
make financial sense. Some product categories are much more likely

(02:54):
to fall victim to shrink flation. These include paper goods
like toilet paper, paper, towels and tissues, as snack foods
like chips, crackers and cookies, breakfast cereals, and cleaning liquid
and shower products like dish soap, shampoo, and moisturizer. According
to a poll by Gardner from June, of American consumers

(03:16):
said that they'd stop buying a brand that implemented shrink
flation to cut costs. If that's true, then brands across
the board might want to watch out. For example, Arm
and Hammer laundry detergent shrunk from seventy to sixty seven
and a half ounces while still promising fifty loads of laundry.
A Quaker instant oatmeal quietly reduced its boxes from ten

(03:39):
packets of oatmeal to just eight, reduction for the same price.
The Folders Instant coffee shrunk from fifty one to forty
three and a half ounces, while still advertising up to
four hundred cups of coffee per container, Gatorade, which is
always come in thirty two ounces, that's one Court Bottles
introduced a new bottle with a tapered at all that's

(04:00):
only twenty eight ounces for the same price. And Briar's
ice Cream, like many other ice cream brands, hasn't sold
a proper half gallon or sixty four ounce container in years,
but Briar's is now sold in forty eight ounce containers,
which is just a court and a half of product
that's less than the original. If all this is starting

(04:21):
to give you a headache, it won't help that will
Leave is now selling ninety pills per bottle instead of
a hundred, and General Mills shrunk its entire line of
family size breakfast cereals and packaged them in slimmer boxes.
Dworsky said, frankly, I don't know how some of those
cereal boxes on the store shelves even stand up anymore.

(04:42):
There's almost no footprint. However, he also pointed out that
it takes a very specific type of consumer to spot
shrink flation, because manufacturers aren't going to advertise that fact.
Now slightly smaller, he said, the only way to know
if your product has shrunk is to know the size
of the products you buy regularly, and to double check

(05:03):
when you go to the store. And it doesn't help
that brands are doing everything in their power to divert
consumer attention away from a product's actual net weight or
sheet count. And not only do old and new packages
look almost identical, but they employ marketing terms like family
size and mega size that don't have any real meaning.

(05:25):
If you notice that your favorite product is shrinking, your
only real option is to compare its price with competitors,
including store brands. To do that, don't look at the
retail price because even competing products come in different sizes.
A Dwarsky says that you need to look for the
unit price, which is the price per ounce or pound
or gallon. That's the only way to make an apples

(05:47):
to Apple's price comparison. As a general rule, though, store brands,
that is, generic brands are the last ones to downsize,
and their qualities usually just as good as the store brands,
so it can be great substitutes. And Dwarski said to
watch out for words like new and improved on a
package label. This might just be a tip off that

(06:09):
the packaging has changed or the product amount is less,
rather than any real improvements being made, but in rare cases,
a downsized product will upsize again. A Costco shoppers were
so upset that Kirkland's signature brand paper towels shrunk from
a hundred and sixty sheets per roll to a hundred
and forty sheets that the company quietly restored the towel

(06:30):
rolls to a hundred and sixty sheets or one for
the consumer. Today's episode is based on the article why
shrink flation has you paying more for less on how
stuff works dot Com, written by Dave Roose. Brain Stuff
is production of iHeart Radio in partnership with how stuff
works dot Com, and it is produced by Tyler Playing.

(06:51):
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