Products shrink but prices don’t

WITH RAW material prices on the increase and health groups encouraging some food brands to decrease their portion sizes, product shrinkage should be a good thing.

 

Not according to Which?

 

The consumer campaign group has discovered that products are shrinking much more than their prices – and in one case the price actually increased.

 

In a new report featured in its magazine, Which? found that some food manufacturers packs had shrunk packs by up to a quarter but prices had stayed the same. Which? called the moves “underhand” and is urging supermarkets and the government to make pricing clearer.

 

Examples listed in the new report include Walkers Cheese & Onion crisps that cost 49p both before and after a 6% shrink. Nestlé Munchies were shrunk from 150g to 126g (16%) but the price only fell from £1.67 to £1.59 (5%) in some supermarkets.

 

Meanwhile, Birds Eye Original Beef Burgers were £3.98 for 12, but are now £4.29 for eight.

 

Manufacturers of the products blamed rising raw material costs – in the face of such rises they have decided to cut pack size rather than up prices.

 

Terry Jones, director of communications at the Food and Drink Federation, said manufacturers are “grappling with incredibly volatile ingredient, energy and raw material costs” and this makes it “incredibly difficult for companies to keep absorbing higher production costs without increasing prices themselves” with efficiencies only going so far.

 

“One way of cushioning consumers from spiralling costs is to reengineer pack sizes. While manufacturers don’t set the ultimate retail price for their goods they make these changes knowing that an increase in price would hit consumers much harder,” he added.

 

A Walkers spokesman said we have faced a combination of consistently rising commodity prices and raw ingredients costs. Where possible we have absorbed these costs, however at the beginning of 2012 we had to make a 2g reduction to the weight of our core Walkers crisps."

 

However, a Which? survey found that 58% of consumers would rather the packs stayed the same price and prices went up, while 37% would rather see packs down-sized.

 

"Shrinking products can be an underhand way of raising prices because pack sizes shrink but the prices don’t,” said Which? executive director Richard Lloyd. “We want simpler pricing so people can easily compare products to see which is the cheapest, and for special offers to be genuine. "

 

 

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