Have you noticed there's something different about your favorite ice cream? The packaging looks the same, and the flavor hasn't changed. The price hasn't fluctuated much either. But it's not your imagination. That tub of mint chocolate chip is shrinking.
More companies are using creative packaging to offset rising production costs. But ultimately, consumers end up paying the price. Here are a few things for consumers to chew on during their next visit to the grocery store and some tips to help you avoid paying more for less. (For more, see 22 Ways To Fight Rising Food Prices.)
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Two years ago, a consumer report showed that ice cream packaging went from the once-standard half-gallon container to 1.75 quarts. National brands, including Edy's and Breyer's, and regionally-based Friendly's, altered their container sizes. Today, that same package has shrunk again to 1.5 quarts.
What's a few ounces, you ask? Consider this: When Haagen-Dazs shrunk its containers from 14 ounces to 12 ounces, it marked a 12.5% size reduction. Consumers ended up paying more per unit price than previously.
Scott toilet tissue has, for years, boasted of its 1,000-sheet roll. That claim may not have changed but the actual square footage has. What was previously packaged as 115.2 sq. ft. is now 104.8 sq. ft.
Likewise, other products such as dish and laundry detergent, coffee, pet food, boxed cereal and mayonnaise are smaller than before. In some cases, the prices have even risen. Orange juice, for instance, is always subject to weather-related conditions and seasonal price fluctuations. Consumers tend to look at the bottom line and not the fact that Tropicana, for instance, comes in a 59-ounce jug, not 64 ounces like previously, according to brandchannel.com.
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Why the Change?
Companies are in business to make money. So, when faced with rising costs in fuel, ingredients, equipment and other production fees, companies became creative.
Marketing analysts say companies don't want to lose customers to higher bills at the check-out counter. So they are taking a gamble by altering package sizes slightly in the hopes that consumers won't notice, or won't be too put-off by a few ounces less here and there as long as the prices stayed the same.
Some companies even put a "green" spin to the market strategy by claiming eco-friendly trends are the reasoning behind the changes.
Not everyone is buying it, though. Research analysts claim that, statistically speaking, smaller packaging means the cost of packaging per unit of product is higher. From an environmentally-friendly perspective, then, buying in bulk is better.
Kimberly-Clark, which has designed the tubeless toilet paper roll sold under the Scott Natural Tube-Free brand, has stated that by eliminating that little cardboard inner tube (approximately 17 billion tubes a year), it can potentially remove about 160 million pounds of garbage from the U.S. annual waste pile. This is all well and good, but what the company's advertisement doesn't say is that in doing so, the company can save millions in production costs. The environment is happier and so is the company's bottom line. (For a related reading, see A Map To Grocery Store Savings.)
What's a Consumer to Do?
Maybe you've accepted the fact that prices go up as time goes on. But given the current economic climate, unemployment numbers and gloomy financial outlook, most consumers are reluctant to dig deeper into their wallets. There are other options to handle shrinking product sizes.
- Give yourself a little more time in the grocery store to read labels and check prices.
Companies collect hefty profits when they change their product packaging, so it's highly unlikely that this trend of "shrinking" will reverse. But savvy consumers don't have to be taken for a fool. A smart shopping strategy, including comparison shopping and coupon clipping, can offset this unfortunate case of shrinkage.
For the latest financial news, check out Water Cooler Finance: Google Shakes Things Up.