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Inflation is doing a number in the economy, and there is no end to it. We are now beginning to feel the aftermath of business shutdowns, a disrupted supply chain and unprecedented growth in money supply.
The numbers are already staggering, and will continue to grow without a change in modern monetary policy
But we don’t have to look at economic data to know that prices are rising fast. That reality is revealed every day in our lives.
The thing is, another kind of “inflation” is happening in the market to deal with rising production costs. And it is also secretly affecting your monthly budget. This is called “contraction” and it is happening wherever you look.
What is contraction?
Shrinkage is a strategy that businesses can use to avoid raising their prices in times of high inflation. Basically, the term describes the shrinkage of the size and quantity of the package without reducing the price. The word is a combination of words Shrink And InflationAnd it was created for its current use British economist Pipa Malmgren Just seven years ago.
The latest example of compression comes from Clinix, which recently reduced the number of tissues in a small box from 65 to 60, leaving the same price point. But this strategy is far from the first company to adopt. In fact, compression is nothing new.
Malmগ্রgren wrote in his 2015 book, “Shrinking product size is exactly what happened in the 1970s just before inflation was set properly. Hint: The breakdown of social contract and the rise of geopolitics.
In times of high inflation, prices are not just rising for consumers. Costs for business are also rising. As everything becomes more expensive — materials, packaging, labor, transportation — companies need to figure out how to handle these rising costs.
In smaller containers, the same price
If you’ve bought a familiar product in recent years and feel that there was something less about it, you’ve noticed a contraction without realizing it.
“It comes in waves. We’re in a tidal wave right now because of inflation,” said Edgar Dwarski – a consumer advocate and former Massachusetts assistant attorney general who is documenting the contraction. Consumer World Website for years – told the Associated Press.
Chobani Flips Yogurt has shrunk from 5.3 ounces to 4.5 ounces. Family size packages of Qibla cookies used to be 17.2 ounces, now they are 14.6 ounces.
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Procter & Gamble, the makers of Charmin, have decided to make rolls of toilet paper smaller as well as enlarge their cardboard tubes. Meanwhile, Cotton’s Ultra Clean Care toilet paper has come down to 340 to 312 sheets.
Nabisco has changed the family size of their wheat thin box from 16 ounces to 14 ounces. A 50-pound bag of Kebals n Beats dog food is now 45 pounds. Pantene conditioner used to come in a 12-ounce bottle, now it’s 10.4 ounces.
But wait, there’s more! Walmart Great Value brand paper towels have gone from 168 sheets per roll to 120. The Frito Le Doritos bag has shrunk from 9.75 ounces to 9.25 ounces and the party size Fritos Scoops has shrunk from 18 ounces to 15.5 ounces.
Hefti’s megapack went from 90 bags to 80 bags. Folgers Coffee has reduced the size of its 51-ounce pot to 43.5 ounces, but they say it still makes 400 cups because of the “light-weight beans”.
Tillamook reduced the size of his ice cream carton from 56 ounces to 48 ounces. General Mills has shrunk its “family size” food grain boxes from 19.3 ounces to 18.1 ounces, while Post has reduced them from 20.5 ounces to 19.5 ounces.
Gatorade claims that they have redesigned their 32-ounce bottle to make it “more aerodynamic” and “easier to hold”. But at the same price, the new design has only 26 ounces.
Here’s what you can do
In an economy with high inflation, it seems that there is no way for consumers to fight contraction. And true, that feeling is right.
As the Fed seeks to come up with new ways to manage inflation without further economic losses, prices will continue to rise and companies are going to do what they can to manage those rising costs. Often, this means shrinking packaging and quantity.
All you can do as a consumer is be aware of what’s happening and be well prepared for your shopping trip. Use a grocery price comparison app like Basket when planning your grocery shopping and meals.
Change your shopping habits to more generic brands. Buy in bulk if possible. Buy whole foods instead of pre-packaged products. And pay attention to the label of the product and the unit price of what you are buying.
Utpal Dholakia – a professor of marketing at Rice University – explained to Forbes that brands usually don’t shrink all their items at once. You can still get a good deal if you buy a variety of products that have not been reduced in size.
You can try to be more aware of single-use products and switch to reusable products if possible. Making some homemade items, such as homemade protein bars or investing in sodstream if you like sparkling water can also help the bottom line.