Business

Taller box, less cereal? Calls for more transparency when companies shrink your groceries

Shrinkflation occurs when a company shrinks a product, but not the price or packaging, making it hard to detect. It has been going on for years, but as Canadians struggle with high food prices, there are growing calls to make the practice more transparent.

Industry group says companies may shrink products to offset rising costs

Two boxes of Honeycomb cereal sitting side by side.
The taller, slimmer box on the left is the new version of family-sized Honeycomb cereal. It contains 525 grams of cereal, an 11.7 per cent reduction compared to the older box on the right, which contains 595 grams. The older box is being phased out. (Submitted by Ellyn Newall)

Ellyn Newall of Edmonton felt duped after a recent grocery shop. 

She had purchased two boxes of family-sized Honeycomb cereal for the same price. But when she unpacked her shopping bag, she noticed one box was slightly taller — and slimmer  — than the other.

Turns out the shorter box is older packaging, which is being phased out. The taller box is new packaging — but taller doesn't mean more product.

In fact, when Newall took a closer look, she discovered the new box has 70 grams less cereal — a reduction of almost 12 per cent.

"The first thing you think is, like: 'How could they do that to us?' You feel upset. You feel deceived," she said. 

It's called shrinkflation and occurs when food producers shrink items but not the price or packaging, making it hard to detect. It has been going on for years. 

But as Canadians struggle with rising grocery prices, there are growing calls for more transparency when companies downsize products. 

WATCH | Some food packages are shrinking:

Transparency needed on shrinkflation, consumer advocates say

7 months ago
Duration 2:34
Consumers and advocates are calling for more transparency around the practice of shrinking packaging rather than increasing prices, known as 'shrinkflation.' Other countries make companies display weight changes on product labels.

"Everything seems to be more expensive now. And by simply reducing the size of their products, people maybe feel like they're being tricked a little bit," said Sylvie De Bellefeuille, a lawyer with the consumer advocacy group Option Consommateurs. 

U.S.-based Post Consumer Brands, makers of Honeycomb cereal, did not reply to requests for comment. 

The company hasn't broken any rules. Manufacturers must display the weight or volume on packaged food labels, but they're not obligated to alert shoppers when they shrink an item.

"If I had noticed this in the store, I absolutely would not have bought this box," said Newall, referring to the new box with less cereal. 

"I would honestly like to say to the federal government to please, please find some way to regulate this."

How widespread is it?

Because shrinkflation can be hard to identify, it's difficult to know precisely how widespread it is and if it's on the rise. 

CBC News combed grocery stores over the past couple of weeks and found several cases of shrinkflation. 

For example, Mondelēz's Wheat Thins crackers has shrunk 10 per cent to 180 grams, Kraft Heinz's Original Kraft Dinner has been reduced 11 per cent to 200 grams, and General Mills's Betty Crocker SuperMoist Cake Mix has shrunk 13 per cent to 375 grams. 

Despite the reductions, the price and packaging remained the same for each product. 

Two boxes of Betty Crocker Super Moist Cake Mix has. One is 432 grams and the other is 375 grams.
Betty Crocker SuperMoist Cake Mix has shrunk from 432 grams to 375 grams — a 13 per cent reduction. (Sophia Harris/CBC)

General Mills did not reply to requests for comment. 

Kraft Heinz and Mondelēz said they reduced their products to offset higher production costs.

The industry group Food, Health and Consumer Products of Canada (FHCP) echoes that argument. 

"Food manufacturers are challenged by increasing costs," FHCP spokesperson Anthony Fuchs said in an email. "Rather than simply pass these costs directly on to consumers, they consider alternatives that can include adapting the size of [the product]."

But consumer advocate De Bellefeuille argues shoppers are more likely to notice a price hike than a subtle weight change. 

"With more transparency, at least we would know that we have less for the same [price], so that we can make better informed decisions," she said.

CBC News data journalist Daniel Blanchette Pelletier has been tracking shrinkflation. Here are some examples. 

Ben and Jerry's acknowledges shrinkage

To help keep Canadians informed, Toronto-based brand strategist Neal Chauhan makes TikTok videos exposing shrinkflation.

They have garnered millions of views and heated viewer comments. 

"They're furious. Not at me, but at the fact that this is actually something that's happening," he said. 

When CBC News met with Chauhan, he was making a TikTok video about Ben and Jerry's ice cream, which recently shrunk by 5.4 per cent to 473 millilitres. 

He credits the brand for being upfront about it. On its website, Ben and Jerry's states it downsized its ice cream to offset higher supply costs. 

"They're one of the only brands who have ever brought attention to this," said Chauhan. "I think it's a great first step." 

Neal Chauhan sitting at his computer working on a TikTok video.
Toronto-based brand strategist Neal Chauhan makes TikTok videos exposing shrinkflation that have garnered millions of views. (James Dunne/CBC)

Chauhan would like the federal government to mandate that food producers alert shoppers when they shrink a product. 

Brazil already requires that companies note recent weight changes on a product's label.

Last month, France pledged to take similar action. Instead of waiting for legislation, major French grocer Carrefour has started posting signs in stores, exposing downsized products. 

A sign in French at French supermarket chain Carrefour warning shoppers of products that have been downsized.
This month, French supermarket chain Carrefour started putting labels on its shelves to warn shoppers of products that have been downsized. (Carrefour/Linkedin)

In 2013, Option Consommateurs submitted a report to the federal government advising it to regulate shrinkflation. Recommendations included requiring companies alert customers on food product labels, as is done in Brazil. 

But Fuchs, with industry group FHCP, warns new labelling requirements could have the "unintended impact" of increasing companies' costs. 

What's the federal government doing about it?

Facing pressure to combat high grocery prices, the federal government says it's creating a grocery task force that will, among other responsibilities, investigate shrinkflation

Justin Simard, a spokesperson for Innovation, Science and Economic Development Canada, told CBC News in an email that Ottawa has identified shrinkflation as a practice that hurts consumers.

However, he had no details yet of any type of action plan. 

As for Newall, once she discovered the new boxes of Honeycomb contained less cereal, she took action by buying several older boxes — before they disappeared. 

"I know that once that sells out, I'm no longer going to get [the same] value for my money."

Tax implications 

Canadians should also be aware that when some food products shrink below a certain amount, they must pay sales tax. 

Although many grocery items are tax-exempt, shoppers must pay tax on snack foods such as muffins, pastries, cereal bars and cookies in packages of less than six and containers of ice cream under 500 millilitres.

Tubs of Ben and Jerry's and Häagen-Dazs ice cream each recently shrunk from 500 millilitres to 473 millilitres and 450 millilitres respectively. That means Canadians now not only get less per tub, but they're also hit with sales tax.

Chauhan discovered this when he purchased two tubs of Ben and Jerry's to make his TikTok video, and was charged 13 per cent harmonized sales tax. 

"We're getting taxed on this because it's technically a single serving. Whether the average consumer is OK with that is a different story," he said.

Despite ever-shrinking products, the Canada Revenue Agency told CBC News it's not reconsidering its rules for taxable snack foods.

WATCH | How shrinkflation affects shoppers: 

How shrinkflation affects Canadian consumers

2 years ago
Duration 2:06
To deal with the impact of rising inflation, companies are reducing package sizes while charging the same prices in what’s known as shrinkflation. Experts suggest consumers can avoid shrinkflation by paying attention to the price per unit rather than the total price.

ABOUT THE AUTHOR

Sophia Harris

Business reporter

Based in Toronto, Sophia Harris covers consumer and business for CBC News web, radio and TV. She previously worked as a CBC videojournalist in the Maritimes where she won an Atlantic Journalism Award for her work. Contact: sophia.harris@cbc.ca

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