Shrinkflation? Cheapflation and greedflation hit the poor harder

On Wednesday, seeking some escape from the news on wars, hurricanes, the US presidential election and Hong Kong Chief Executive John Lee Ka-chiu’s policy address, I tuned in to RTHK’s Backchat radio programme, which featured a limp and rather vacuous assault on shrinkflation – triggered by a recent Consumer Council report that 58 of a surveyed 62 supermarket products had been downsized over the past three and a half years.

I was puzzled by the fresh outrage. Hasn’t shrinkflation been with us forever? Don’t manufacturers wrestling with competition and inflationary pressures always resort to sneaky downsizing before raising prices?

True, the word itself is a relatively recent creation – shrinkflation, as is currently understood, is thought to have been coined by economist Pippa Malmgren about a decade ago. But downsizing in the face of inflationary pressures has been an issue of popular concern at least since the 18th century, when French bakers were thought to have wrestled in vain with sharp flour price increases by making smaller loaves.

In recent years, we have been regularly scandalised by shrinking Gatorade and Coke bottles, bags of crisps puffed up with air and ice-cream cartons with hollow bottoms to disguise smaller portions.

Remember Cadbury cutting two squares from its chocolate bars while keeping the price the same? Or Mars bars suddenly being shrunk? Or wider gaps in Toblerone bars that meant 10 per cent less chocolate?

The pricing of consumer goods has been a controversial and confusing quagmire for as long as most of us have been alive. Price volatility can be driven by whether particular products are in season, supply chain disruptions (which occurred dramatically during the Covid-19 pandemic), retailers’ discount strategies and, for individuals, whether you can buy in bulk. Online shopping is also a major influence on price comparison and competition.