Video: Same price, smaller package

By
NBC News and msnbc.com
updated 7/7/2008 6:59:53 PM ET 2008-07-07T22:59:53

With fuel and delivery costs rising, food manufacturers are faced with raising their prices or giving you less, and it seems that less is the growing trend.

To Dean Smith, the two containers of Breyers ice cream looked exactly the same at his supermarket in Evansville, Ind. Then he looked closely and figured out that the old package was 1¾ quarts, while the new package was just 1½ quarts.

“You can’t tell at all,” Smith said.

Tod Marks, senior editor for retailing at Consumer Reports, says you’re not imagining things. What the consumer protection Web site Consumerist.com calls the Grocery Shrink Ray is hitting products all over the store.

The practice is called short-sizing, and it’s becoming increasingly common to shrink how much stuff goes into the same old box to keep costs down.

“Years ago, I think the first product we saw with the incredible shrinking package had to do with coffee,” Marks said.

“You remember the can of coffee, used to be typically one pound? Some of them are down to 10 ounces now for your pound of coffee,” he said. “Then it started spreading.”

Like that ice cream.

“We’ve gone from a half-gallon to 1¾ quarts to now as little as 1½ quarts,” Marks said. “That’s a tremendous, tremendous short-sizing of a package [at the] same time the price is rising.”

Less bang for more bucks
When inspectors for the Nassau County, N.Y., Consumer Affairs Office went looking around last month, they found that all sorts of products were being short-sized, none more so than breakfast cereal.

“We’re seeing it more and more given the high cost of flour and wheat,” said Roger Bogstead, the county’s consumer affairs commissioner. “Consumers are trying to get the best bargain they can, and the manufacturers don’t want the consumers to know that they’re raising the prices.”

Inspectors found two boxes of Stop & Shop brand shredded wheat cereal in supermarkets. One was 19 ounces. The newer one was 18 ounces. The boxes were identical, as were the prices.

Likewise Cocoa Magic, which Bogstead said had shrunk from 18 ounces to a bit more than 16 ounces.

And it’s not just food. Inspectors picked three-packs of Irish Spring and Dial soaps and found that they had been short-sized, too.

Nationwide, Kellogg Co. hiked its cereal prices last month for the second time this year. A spokeswoman acknowledged that it had reduced the sizes of Froot Loops, Cocoa Krispies and Apple Jacks, among other brands.

General Mills made a similar move earlier this year. NBC News found two boxes of the company’s Cheerios cereal on sale in a New York supermarket. Both were $3.39. One was 10 ounces; the newer one was 8.9 ounces.

A price of $4.89 used to get you 32 ounces of Hellman’s mayonnaise. Now it gets you 30 ounces. Unilever PLC, which makes both Hellman’s and Breyers, told NBC News that its products had been reduced to offset increasing energy costs.

Lesser of two evils?
Manufacturers said they were being pummeled by the high cost of both fuel and raw ingredients. Faced with disappearing margins, these and other manufacturers said in general that they had a choice: shrink the product or increase the price. Short-sizing, they believe, is a legal way to save money without giving consumers sticker shock.

But Marks said the practice was just a way to hike prices under the radar of consumers.

“It’s a shell game, call it what you will,” Marks said in an interview on NBC’s TODAY. “In these tough economic times ... the worst thing that can happen for a manufacturer at this point is to raise prices. So they use this sneaky tactic of giving you less and charging you more.”

And consumers do notice.

“When you find out you’re paying more but getting less, you’re left to believe somebody is doing something wrong,” Randy Compton said on a recent shopping trip to an Apple Market in Mobile, Ala.

Of a can of corn he pulled off the shelf — previously 14 ounces, now 11 ounces, and costing the same — he said: “The size of the can is the same, but the net weight of the actual corn is smaller. They’re magicians, and they’re pulling an illusion over your eyes.”

Leah Ransohoff of Evansville was more blunt. “It’s like a rip-off,” she said as she strolled the aisles of her local market.

For retailers like Pat Locurto, owner of Pat’s Meat Farms in Farmingdale, N.Y., short-sizing is a monumental headache. Locurto hears his customers’ complaints, but he says there’s really nothing else he can do.

“A lot of packaging is getting smaller for the same price. The weights are getting changed,” Locurto said.  “A lot of people don’t notice, but a lot of people do, and they’re mumbling and grumbling.

“They think it’s us, but it’s not us,” he said. “It’s coming from the company.”

Angelo Lucarelli, manager of De Cicco Food Market in Ardsley, N.Y., said: “It’s almost like I’m the middleman. I’m between what’s going on with the manufacturer and what’s going on with the consumer. But I’m the one who’s got to answer to the people.”

The best advice, consumer affairs experts said, is to keep a sharp eye out in the store.

Look for the “unit price,” which is usually right on the store shelf alongside the full retail price. It will show you how much you’re paying per ounce or per pound. And save your supermarket receipts for several weeks so you can compare them over time.

Paul Dholakia, a management professor at Rice University in Houston, said manufacturers were banking on customers not noticing changes in quantity unless they changed significantly.

“I think it’s important for us to us to teach people how to make good decisions,” Dholakia said. “My advice to consumers is that you have got to be vigilant and not be driven by habitual decision-making, but instead, pay attention to the actual quantity information.”

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