August 19, 2008

Retailers Charge Same for Less As They ‘Shrink’ Your Groceries

The size of some UK groceries have been shrunk without any reduction in price by manufacturers claiming inflationary pressures.

Manufacturers have reduced the size of products including a Cadbury's chocolate bar, Pampers nappies, Kraft Foods' Dairy Lea triangles and Birds Eye garden peas, but prices have remained the same.

The National Consumer Council said it was concerned consumers were unknowingly paying more for products when household budgets were being hit by spiralling fuel, petrol and food prices.

Jeff Allder, policy expert at the National Consumer Council, said: "We are extremely concerned to hear about goods shrinking in size without shrinking in price, as it cheats unsuspecting shoppers already under financial pressure from rising household and motoring costs.

"In America it is known as the grocery shrink ray and this is one trend from the US that we definitely don't want over here.

"We have heard reports of a considerable number of brands downsizing in this way, presumably because the grocery industry faces increased costs for energy and ingredients, but doesn't want to be seen to raise prices. Even in a credit crunch, most customers are savvy enough to see these tactics as underhand. Companies should realise that, once caught out, their corporate reputation could suffer and customers always have the power to switch brands. A brand needs to be trusted by shoppers to survive, so any company considering short changing their customers should think again."

Cadbury said it had downsized the Family Share bar from 250g to 230g but kept the original pounds 1.38 cost.

A Cadbury spokesman said: "We seek to keep our confectionery affordable in order to offer our consumers value for money and therefore we have slightly reduced the size on some of the larger sharing packs rather than directly raising prices."

Strongbow cider has reduced its cases of cider from 18 cans to 15 cans for pounds 10.98.

Mark Gerken, managing director of manufacturer Scottish & Newcastle, said: "The decision to introduce a new 15-can pack of Strongbow was brought about by our need to raise wholesale prices in the face of the widespread and unprecedented increase in business costs and the retailers' desire to continue to offer the brand in similar party pack format at the same price point." Pampers Baby Dry Economy Packs have four fewer nappies across the entire range of sizes, but the company said it had added extra nappies to some other packs without increasing the cost.

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