Ever noticed your favourite cereal, packet of chips or even cleaning spray looking a little smaller or feeling lighter in your hand?
“Shrinkflation” is when a product is downsized but sold at the same price, or possibly even a higher price — and maybe, brands hope, without you noticing.
Coles and Woolworths have already been hauled before the courts by the competition watchdog of alleged fake discounts, discussions have begun to change zoning laws to open up combat claims of “land banking” by the duo, and consultations are underway to impose a mandatory code of conduct over the sector.
Now the federal government is taking the bat to the supermarket sector again.
This time, it promises to tackle tricky shrinkflation tactics by strengthening the rules around how products are priced so that they can be compared more easily.
Supermarkets already display the “unit price” for items on sticker labels, but the government says the practice has become more common.
In March, consumer group Choice documented 10 recent offenders including Coles’ Mighty Grain cereal, which lost 65g in weight but kept the same $4.50 price tag, and an identical downsizing of Woolworths’ brand Max Charge grain cereal.
Choice tracked several products and found multiple examples of goods being downsized while their prices remained the same or even increased.
Hot cross buns had 30g sliced off between 2023 and 2024 while their price increased by 50 cents, Woolworths corn chips shrunk from 200g to 175g for the same price and Jif’s bathroom cleaner shrunk by 200mL while increasing from $2.50 to $4.
Coles and Woolworths told Choice they did not profit from those changes, and pack size changes had been requested by suppliers.
New rules would improve readability, comparability, prominence
An ongoing inquiry into the sector by the Australian Competition and Consumer Commission heard shoppers were concerned about how supermarkets display prices.
The government says it plans to change the Unit Pricing Code to improve readability and visibility of prices in stores, address inconsistent unit measurements and improve comparability of prices between stores.
It will also consult on whether to expand who is covered by those rules.
Those who breach the code would be hit with “substantial” penalties.
Prime Minister Anthony Albanese said the changes would make pricing fairer.
“Tackling ‘shrinkflation’ through stronger unit pricing and new penalties is part of our plan to get a better deal for Australians,” Mr Albanese said in a statement.
“Australian consumers deserve fair prices, not dodgy discounts.”
