Changing face of chocolate
It was the end of last year when consumers started to notice the size of their favourite chocolate bars shrinking, and a new study by the UK’s Office for National Statistics (ONS) has finally confirmed what many of us already knew.
But it’s not just chocolate bars that have succumbed to so-called shrinkflation – where manufacturers reduce the package size of household goods while keeping the price the same. According to the study, 2,529 products have reduced in size between January 2012 and June 2017, compared to just 614 that have increased. These were mostly in the food and drink category and included coffee, fruit juice and chips.
While the move has had little effect on headline inflation, the changing pack size has contributed 1.22 percentage points to the rate of inflation for sugar, jam, syrups, chocolate and confectionery.
Many manufacturers have said the reason for such a move is due to the rising costs. What’s interesting, however, is that the study shows that the European import price of sugar has been slowly falling since the middle of 2014 and in March 2017 it reached its lowest level since the International Monetary Fund records began in 1991.
What’s more is that the study doesn’t show a noticeable change following the European Union referendum that would point towards a Brexit effect.
Raphael Moreau, food analyst at Euromonitor International, says that while the so-called shrinkflation is “not a new phenomenon,” it has become more widespread since the second half of last year and the full impact of the depreciation of the pound is not yet felt.
“Offering smaller portions is likely to remain a more widespread strategy across the industry as it offers a potentially less damaging solution than a straight price increase for retailers and manufacturers alike,” she explains.
“Alternatively, manufacturers focus on newer type of products such as those targeted at sharing in confectionery and savoury snacks, for example Kit Kat Bites and Walkers Tear ‘n’ Share, as these products often command higher nominal prices than the regular variants from which they are derived.”