Shrinkflation is back in the news — and here’s what it means for Irish consumers

The cost of some Christmas chocolates has increased has by 87% in 7 years

The Collins English Dictionary defines “shrinkflation” as the practice of reducing the size of packaged food, like chocolate bars, while keeping the price unchanged. 

The Collins English Dictionary defines “shrinkflation” as the practice of reducing the size of packaged food, like chocolate bars, while keeping the price unchanged. 

Food manufacturers use shrinkflation to maintain profits while giving the impression that the product is the same.

Manufacturers may also alter ingredients and packaging to fine-tune their profit levels. This can result in a poorer quality product on the shelves that costs the same as the original. It may taste similar (or not) but the quality or volume of the ingredients can be reduced by as little as 1/2 a gramme - which in bulk can add up to big savings for the manufacturer.

Shrinkflation has been affecting some items more than others. Like chocolate, coffee is extremely vulnerable to climate change and prices have been rising for the last several years.

Depending on your product preferences, you could be disproportionately affected by shrinkflation, particularly if you like certain brands of coffee.

Tassimo is a popular coffee pod brand that I used to buy to save money on buying takeaway cups. When the cost of production started to increase in 2023, its pack size reduced from 16 pods to 12. I’m sure the manufacturers are abundantly aware that Tassimo machine owners were a captive audience, changing coffee machine requires an additional investment.

Although the pack size of these coffee pods reduced, the price remained the same at €11 for two packs on price promotion. This was an excellent example of shrinkflation. Today, despite special offers, two packs of Tassimo will set Irish consumers back €13. When the shrinkflation and inflation of this one coffee product are combined, the cumulative price increase is over 57%.

As it’s particularly vulnerable to high temperatures, the cost of chocolate is increasing due to climate change. The quality of the chocolate products we buy in the supermarket is on the decline.

Cocoa plants are highly vulnerable to increased temperatures and have a 3-to 4-year life cycle; high temperatures over several years have significantly impacted the crop. As a commodity, the price of chocolate has increased. As climate change continues at pace, the rate at which the crops are failing is accelerating. There may come a time in the future when chocolate becomes a luxury rather than an everyday item.

This week as the supermarkets start to gear up for what should be the most wonderful time of the year, it became apparent that not everything was the same as 2024. A Christmas tin of Quality Street weighed 600g last year and 650g in 2021. This year following the trend set by Cadbury's Roses in 2023, a tin of Quality Street will reduce to 550g in size; the number of sweets contained in the tin is decreasing to save the manufacturer money.

In 2018 a 1.2kg tin of Quality Street in my local SuperValu on special offer cost €7. This week in the same supermarket, a 550g tub of Quality Street costs €6. This represents a price increase of 87% per kg of Quality Street in the past 7 years.

Traditionally Christmas is a season where many food producers and retailers 'make bank' and generate higher profit margins than other times of the year. Consumers are more likely to spend money over Christmas, and particularly on items that generate nostalgia and a feel-good factor. Traditional chocolate products like advent calendars and tins of sweets consistently perform well. It's likely that even with the smaller tin size, Quality Street will still sell well this year.

Hallowe’en is fast approaching too and it’s fair to say that increasing price is an equal opportunities affliction when it comes to sweet treats. A bag of 140g Haribo Supermix jellies from Dunnes Stores cost me €1 in 2023, today that same bag costs €1.25.

It’s not too difficult to calculate the increase in the cost of jellies at 25% in the space of two years. The consumer price index for the same period is 3.9%. You could say that the cost of sweet treats is rising far more rapidly than the indexed rate of inflation.

Shrinkflation + Inflation = Big prices at the till

Ultimately, when you combine a commonly used product that has suffered from both shrinkflation and inflation, you can expect to pay far more when the groceries come off the conveyor belt. The CPI produced by the CSO tracks products by weight and volume and has no scope to track shrinkflation. I should add also that the CSO only tracks the prices and does not have any part to play in the prices set by retailers and producers.

All of this is not news to those of us who are struggling with the cost of our supermarket shops. I recently received a message from a mother who believes the cost of her grocery shopping has doubled in two short years. Her stress and upset were palpable in just a few sentences and she’s not alone in her struggles.

What is your experience of grocery shopping, particularly recently? Do you feel like the prices are increasing at a greater rate than 5% in the past year?

REDMOND RECOMMENDS

With the colder weather on the way, now is the time to clean the hinges seals on your windows and doors. It’s easily done with a damp cloth or paintbrush. 

That seal will help prevent drafts in the Winter. My windows weren’t closing properly last year so I replaced the hinges and now they seal perfectly at a fraction of the price of a new set.

Remember, if you feel cold in the house but are wearing light clothing, put a warm jumper on. A warm jumper will increase your body heat by up to 5 degrees! This will go a long way towards reducing your energy bill.