A fall in the value of the pound since the Brexit vote, coupled with problems caused by the rising prices of some commodities, has been blamed for the reduction in pack sizes known as shrinkflation This week, three big name brands are shrinking pack sizes in a bid to fight off passing on prices rises to their consumers.
According to reports in The Grocer, The Independent & PackagingNews – Doritos, Peperami and Coco Pops have all reduced the size of packs at a time when costs are rising due to the falling pound.
The move has been dubbed ‘shrinkflation’ with a sharing bag of Doritos reduced from 200g to 180g, although the price remains £1.99. Peperami snacks have also come down from 25g to 22.5g. A large box of Coco Pops has been reduced from 800g to 720g. Doritos owner PepsiCo said that fluctuating foreign exchange rates are hitting the cost of materials, while Peperami said that it has also been subject rising commodity costs. However, Kellogg’s – the owner for Coco Pops – said that the reduction in sugar was responsible for the drop in pack weight. “We recently reduced sugar in Coco Pops Original by 14 per cent, which has reduced the weight of some packs,” a spokesperson said. A spokesperson for Doritos owner PepsiCo said that the company is facing factors such as “fluctuating foreign exchange rates which are impacting the cost of ingredients and materials”.
Lianne van den Bos, senior food analyst at Euromonitor International, said: “Retailers are trying to keep products at as low a price as possible in their stores in order to compete with discounters such as Aldi and Lidl, whilst manufacturers’ input costs are going up, they have been expected to sell their products at the same price as before. The only way for companies to do this and mitigate the impact on profit margins is to shrink the size of the product.
Last year, Toblerone came under fire after the space between the distinctive triangles of its bars was increased. Rival Mars has also shrunk its sharing bags of Maltesers by 15 per cent. Earlier this year, Premier Foods, which makes Mr Kipling cakes and Bisto gravy, said it was in talks with supermarkets over pushing up prices by about 5 per cent. According to the latest BRC-Nielsen Shop Price Index, food inflation hit 1 per cent year-on-year last month, the sharpest rise in more than three years. Expense Reduction Analysts say “now is the ideal time to see how our analysts can help your business find cost savings across categories such as packaging, logistics, and transport costs.
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Article by: Glenn Kenworthy