WEBVTT - How Does Shrinkflation Work?

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<v Speaker 1>Welcome to brain Stuff, a production of iHeart Radio. Hey

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<v Speaker 1>brain Stuff, Lauren Vogelbaum Here, pardon the personal question, but

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<v Speaker 1>have you noticed that you're going through rolls of toilet

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<v Speaker 1>paper faster than usual? There's a good reason for that.

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<v Speaker 1>A toilet paper rolls are shrinking. In the past couple

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<v Speaker 1>of years, major brands have reduced the number of individual

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<v Speaker 1>sheets on each toilet paper roll. The packages still contain

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<v Speaker 1>the same number of total rolls, but each role is slimmer.

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<v Speaker 1>Sharman's Mega roll shrunk by seven point a, Kirkland Signature's

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<v Speaker 1>rolls dropped by ten point and Angelsoft's Mega Roll plummeted

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<v Speaker 1>by reduction. However, the manufacturer said that it thickened the

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<v Speaker 1>sheets at the same time. So but while there are

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<v Speaker 1>fewer sheets per role, the price per role has remained

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<v Speaker 1>the same. Welcome to the infuriating world of shrink flation.

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<v Speaker 1>Shrink Flation is a simple economic concept. Inflation rates are

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<v Speaker 1>high around the world right now, which means manufacturers are

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<v Speaker 1>facing higher prices for raw materials, ingredients, packaging, shipping, and more.

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<v Speaker 1>To continue to make the same profit, companies have two options.

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<v Speaker 1>Either raise the price of their products or charge the

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<v Speaker 1>same price for less of the product. Brands know that

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<v Speaker 1>consumers are price sensitive, a meaning that they're likely to

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<v Speaker 1>notice when the price of a frequently purchased item like

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<v Speaker 1>toilet paper goes up. But what kind of consumer would

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<v Speaker 1>notice if their meta rolls of toilet paper were just

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<v Speaker 1>eight per thinner, especially if the packaging and branding were

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<v Speaker 1>otherwise unchanged. One Edgar dwarf Ski would notice a dwarf

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<v Speaker 1>Sky is a consumer lawyer and the genius behind the

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<v Speaker 1>consumer advocacy websites consumer World and mouseprint dot org, where

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<v Speaker 1>he maintains a long list of products that have fallen

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<v Speaker 1>victim to shrink flation. For the articles episodes based on

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<v Speaker 1>hos to work spoke with him. He's been tracking shrink

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<v Speaker 1>flation for decades, but says that there was a rash

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<v Speaker 1>of products that shrunk due to manufacturers grappling with record

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<v Speaker 1>high inflation. Recently, the CEO of Kellogg claimed that when

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<v Speaker 1>his company makes a product smaller, they also lower the price,

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<v Speaker 1>but dwarf Sky has identified hundreds of examples of brands,

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<v Speaker 1>including Kellogg's Keebler line of cookies, charging the same or

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<v Speaker 1>more for smaller products. Dwarsky said no company would go

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<v Speaker 1>through the increased cost of retooling their manufacturing plant and

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<v Speaker 1>redesigning the package. If they just didn't exact proportional drop

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<v Speaker 1>in the number of ounces in the price, it doesn't

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<v Speaker 1>make financial sense. Some product categories are much more likely

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<v Speaker 1>to fall victim to shrink flation. These include paper goods

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<v Speaker 1>like toilet paper, paper, towels and tissues, as snack foods

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<v Speaker 1>like chips, crackers and cookies, breakfast cereals, and cleaning liquid

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<v Speaker 1>and shower products like dish soap, shampoo, and moisturizer. According

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<v Speaker 1>to a poll by Gardner from June, of American consumers

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<v Speaker 1>said that they'd stop buying a brand that implemented shrink

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<v Speaker 1>flation to cut costs. If that's true, then brands across

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<v Speaker 1>the board might want to watch out. For example, Arm

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<v Speaker 1>and Hammer laundry detergent shrunk from seventy to sixty seven

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<v Speaker 1>and a half ounces while still promising fifty loads of laundry.

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<v Speaker 1>A Quaker instant oatmeal quietly reduced its boxes from ten

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<v Speaker 1>packets of oatmeal to just eight, reduction for the same price.

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<v Speaker 1>The Folders Instant coffee shrunk from fifty one to forty

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<v Speaker 1>three and a half ounces, while still advertising up to

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<v Speaker 1>four hundred cups of coffee per container, Gatorade, which is

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<v Speaker 1>always come in thirty two ounces, that's one Court Bottles

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<v Speaker 1>introduced a new bottle with a tapered at all that's

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<v Speaker 1>only twenty eight ounces for the same price. And Briar's

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<v Speaker 1>ice Cream, like many other ice cream brands, hasn't sold

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<v Speaker 1>a proper half gallon or sixty four ounce container in years,

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<v Speaker 1>but Briar's is now sold in forty eight ounce containers,

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<v Speaker 1>which is just a court and a half of product

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<v Speaker 1>that's less than the original. If all this is starting

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<v Speaker 1>to give you a headache, it won't help that will

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<v Speaker 1>Leave is now selling ninety pills per bottle instead of

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<v Speaker 1>a hundred, and General Mills shrunk its entire line of

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<v Speaker 1>family size breakfast cereals and packaged them in slimmer boxes.

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<v Speaker 1>Dworsky said, frankly, I don't know how some of those

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<v Speaker 1>cereal boxes on the store shelves even stand up anymore.

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<v Speaker 1>There's almost no footprint. However, he also pointed out that

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<v Speaker 1>it takes a very specific type of consumer to spot

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<v Speaker 1>shrink flation, because manufacturers aren't going to advertise that fact.

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<v Speaker 1>Now slightly smaller, he said, the only way to know

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<v Speaker 1>if your product has shrunk is to know the size

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<v Speaker 1>of the products you buy regularly, and to double check

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<v Speaker 1>when you go to the store. And it doesn't help

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<v Speaker 1>that brands are doing everything in their power to divert

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<v Speaker 1>consumer attention away from a product's actual net weight or

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<v Speaker 1>sheet count. And not only do old and new packages

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<v Speaker 1>look almost identical, but they employ marketing terms like family

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<v Speaker 1>size and mega size that don't have any real meaning.

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<v Speaker 1>If you notice that your favorite product is shrinking, your

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<v Speaker 1>only real option is to compare its price with competitors,

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<v Speaker 1>including store brands. To do that, don't look at the

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<v Speaker 1>retail price because even competing products come in different sizes.

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<v Speaker 1>A Dwarsky says that you need to look for the

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<v Speaker 1>unit price, which is the price per ounce or pound

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<v Speaker 1>or gallon. That's the only way to make an apples

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<v Speaker 1>to Apple's price comparison. As a general rule, though, store brands,

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<v Speaker 1>that is, generic brands are the last ones to downsize,

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<v Speaker 1>and their qualities usually just as good as the store brands,

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<v Speaker 1>so it can be great substitutes. And Dwarski said to

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<v Speaker 1>watch out for words like new and improved on a

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<v Speaker 1>package label. This might just be a tip off that

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<v Speaker 1>the packaging has changed or the product amount is less,

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<v Speaker 1>rather than any real improvements being made, but in rare cases,

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<v Speaker 1>a downsized product will upsize again. A Costco shoppers were

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<v Speaker 1>so upset that Kirkland's signature brand paper towels shrunk from

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<v Speaker 1>a hundred and sixty sheets per roll to a hundred

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<v Speaker 1>and forty sheets that the company quietly restored the towel

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<v Speaker 1>rolls to a hundred and sixty sheets or one for

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<v Speaker 1>the consumer. Today's episode is based on the article why

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<v Speaker 1>shrink flation has you paying more for less on how

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<v Speaker 1>stuff works dot Com, written by Dave Roose. Brain Stuff

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<v Speaker 1>is production of iHeart Radio in partnership with how stuff

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<v Speaker 1>works dot Com, and it is produced by Tyler Playing.

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