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Why Is My Ice Cream Shrinking? Inflation by Stealth


Groceries are becoming more expensive. What people may not have noticed is they’re getting smaller too. By reducing the size of, say, a jar of jam, a food company can effectively charge more for it while avoiding a sticker price hike that would dent sales. It’s not a new tactic, but “shrinkflation” is back in vogue now the industry is grappling with soaring costs of everything from wheat to vegetable oils and energy. 

Humorist Art Buchwald was among the first to draw attention to the practice in a column entitled “Packaged Inflation” published in 1969. It became more widespread during the 1970s, when manufacturers looked for creative ways to protect their profit margins from cost increases and stagnant growth. Today you can witness shrinkflation, also referred to as “downsizing,” anywhere from Australia to India and the UK. In the years following the Brexit vote, Britain’s Office for National Statistics noticed more examples of product shrinkage, including Mondelez International Inc. reducing the weight of some of its Toblerone chocolate bars. They reverted to their original dimensions following an outcry from consumers.