France’s Carrefour Sounds Alarm on ‘Shrinkflation’

The French supermarket chain Carrefour has taken a proactive step this week by affixing stickers on its store shelves to alert customers to the phenomenon known as “shrinkflation”.

The term “shrinkflation” refers to the situation where the quantity of product inside a package decreases, yet the prices remain unchanged.

Several well-known brands, including Lipton Ice Tea, Lindt Chocolate, and Viennetta Ice Cream, are finding themselves in the spotlight as they are singled out for this practice.

Carrefour’s initiative aims to empower shoppers by helping them identify when the bottles have been downsized or when the contents of a package have been reduced in weight.

Carrefour has taken this stance in its bid to exert pressure on manufacturers to maintain competitive pricing standards.

“The primary goal of drawing attention to these products is to encourage manufacturers to reconsider their pricing strategies,” Director of Client Communications at Carrefour, Stefan Bompais, explained.

Carrefour’s scrutiny has pinpointed 26 products that have undergone reductions in size without corresponding price reductions. These productions hail from industry giants such as Nestle, PepsiCo, and Unilever.

Carrefour, for instance, noted that Nestle’s Guigoz infant milk formula has changed from a 900g pack size to 830g, representing a reduction without a corresponding cost adjustment. Additionally, a bottle of sugar-free peach-flavored Lipton Ice Tea, produced by PepsiCo, has downsized from 1.5 liters to 1.25 liters, according to the supermarket’s findings. Viennetta, a product from Unilever, has also experienced a decrease in size, shrinking from 350g to 320g.

As the second-largest grocery retailer in France, Carrefour is taking a visible stance by employing signage on the shelves to highlight these products, with notices that read, “This product has seen its volume/weight fall while the effective price charged by the supplier has risen.”

Up to now, there has been no official response from Unilever, PepsiCo, or Nestle regarding Carrefour’s initiative.

French retailers and food producers are facing mounting pressure to lower prices, mirroring a trend seen in the UK, where consumers are grappling with significant price increases.

In June, French Finance Minister Bruno Le Maire convened a meeting involving 75 retailers and consumer organizations to address the issue of rising prices. Le Maire has openly criticized manufacturers for not aligning with efforts to curb inflation.

Similar concerns about “shrinkflation” affecting the value of everyday items, ranging from cat food to chocolate biscuits, have also been raised by British consumer groups.

However, it’s unlikely that UK supermarkets will adopt a strategy similar to Carrefour’s, as suggested by retail expert Ged Futter, who belives that such an approach could potentially harm the delicate relationships between retailers and food companies, describing it as a “blunt way of trying to compete.:

Futter believes that implementing such measures with manufacturers may not yield positive results.

Futter pointed out that supermarkets themselves employ the shrinkflation tactic with their own-label products. They often aim to maintain a specific price point, such as 1 pound, by either using more economical ingredients or reducing portion sizes to cope with rising production costs. Therefore, he suggested that criticizing brands for the same practice might invite accusations of hypocrisy, akin to “people in glass houses throwing stones.”

In response to Carrefour’s findings, a spokesperson for Lindt & Sprungli, one of the brands highlighted by Carrefour for shrinking its products, stated that their prices had increased by an average of approximately 9.3% in alignment with rising raw material costs. The spokesperson stressed that information regarding product size was always made transparent to consumers.

“We consistently adhere to labeling laws and regulations that mandate providing objective information about the quantity of product in the package, including net weight, serving size, and servings per container. Consumers can utilize this information to make informed purchasing decisions about the quantity of product they are buying.”