People feel widening shrinkflation squeeze

For years, potato chips have been a staple, bought regularly by Mr Wasiful Huq for his two kids.
So, he was understandably perplexed when, months ago, he opened a pack of locally made potato crackers -- a popular and old local chip brand -- and found noticeably fewer chips than usual.
Mr Huq, a resident of Wyre Street in old Dhaka's Wari area, shared his surprise with his wife, Ms Rubana. Initially, the couple thought it was a one-off mistake, perhaps an accidental underfill.
But upon buying more packets of the same chips, the realisation dawned: this wasn't an anomaly.
"That's the regular potato chips, not a fluke," Mr Huq, 54, told his wife, recounting the experience to this correspondent recently.
Mr Huq is not alone. Like him, countless chip and snack fans have faced the same and have taken to their social media handles in recent times to share their experiences.
According to those posts and conversations, this has not been confined to only potato chips, rather many food and even non-food packs are showing visible signs of getting smaller.
Driven by stubborn food inflation hovering around 12 per cent, food producers are resorting to this age-old tactic to camouflage rising costs while maintaining price tags.
In economics, it is called "Shrinkflation" -- involves subtly reducing the quantity or quality of products instead of raising prices directly.
An old technique now put in widespread usages this marketing technique dates back to the Roman emperors, who debased coins with cheaper metals to fund their conquests. Mediaeval bakers, too, employed it to quell bread riots by shrinking loaf sizes.
However, its widespread adoption in Bangladesh's contemporary market feels particularly unsettling.
Strolling around Bangladesh's local markets and 'moholla' groceries now requires more than just a well-stocked wallet to combat inflation. Consumers also need a magnifying glass to decipher the fine print on packaging, meticulously checking what lies beneath the surface.
Many everyday items, from potato chips and biscuits to cakes and even ballpoint pens, are shrinking faster than their price tags -- leaving consumers to get less in the package than earlier at the same price.
Take the oldest and popular potato crackers brand in Bangladesh, for example. Besides, another old Dhaka famous baker, a Chattogram-based biscuit-maker, a multinational pound cake manufacturer and even a prominent ballpoint producer have all gotten noticeably slimmer. The net weight reductions aren't subtle -- vertical and horizontal downsizing is evident across the board.
Those with exceptional memories, or 'hyperthymesia' in medical terms, can easily compare previous and current packaging, noting the weight discrepancies manufacturers try to disguise.
For more thrifty shoppers, even the humble Tk 5 ballpoint pen isn't immune. Pens that once lasted days now run dry within hours.
The old Dhaka bakery's premium toast used to weigh 250 grams but now tips the scales at just 185 grams -- a 25 per cent reduction. While the price remains at Tk 50, the value shrink for each packet is undeniable.
Similarly, the multinational cake maker, who established a joint venture in Bangladesh in 2015, has shed 10 grams, going from 80 grams to 70 grams, while experiencing a slight price increase to Tk 35.
The Chattogram-based snacks, a household favourite, have also shrunk, losing 12.5 per cent of their weight, from 400 grams to 350 grams.
Uncounted, it's the dark side of inflation
Economists call 'shrinkflation' -- the dark and shadowy side of inflation -- the stealthy cousin of inflation.
Dr M Masrur Reaz, chairman and CEO of the Policy Exchange of Bangladesh, says, "Many consumers, unfortunately, don't notice or even think about the weight loss."
With inflation reaching a 12-year high, Dr Reaz pointed to a shift in packaging strategies.
"I've never seen such a wide variety of goods resorting to shrinkflation before," he told The Financial Express. "In an open market, producers compete for profits. They want to maximise them as they can't incur losses."
However, while the government's statistics bureau BBS tracks inflation across 383 items, their focus remains solely on price, not on the actual weight of the items being sold.
Dr Reaz urged consumers to be watchful, suggesting, "Instead of just glancing at the price tag, take a moment to check the contents and ingredients inside. It's time to read the fine print, literally, to understand what you're paying for."
In the meantime, local consumer goods manufacturers said that they had little choice but to rely on such techniques as the production costs soared by 50 to 100 per cent on the back of higher inflation.
"We don't have any other option," Mr Kamruzzaman Kamal, marketing director at Pran RFL Group, one of the leading conglomerates in Bangladesh, told the FE.
He confirmed employing shrinkflation for biscuits and bakery items, claiming it "makes products more affordable for customers."
Md Asif Hasan, a director at Well Food Group, echoed the same sentiment: "You can't just raise prices drastically, so this is a marketing strategy." He believes it has so far helped retain customers.
However, not all companies agree.
Uzzal Kumar Saha, managing director of the listed GQ Ball Pen, insisted that they were not using shrinkflation. "We haven't reduced ink; we're selling at a loss due to soaring ingredient prices."
Concerns go beyond shrinking packaging as some manufacturers are reportedly turning to cheaper alternatives such as reusing cooking oil, reducing butter, cheese or sugar substitutes and using substandard ingredients in soaps.
Nowadays, bathroom soaps reportedly generate less lather and show faster deterioration. The secret lies with soap ingredients.
But, these practices are harder for both consumers and statisticians to track. The Bangladesh Bureau of Statistics (BBS) only monitors prices, not ingredient changes.
"If a manufacturer cuts ingredients, the BBS doesn't care, they just track prices from chosen markets," said an economist.
Yet these hidden changes can easily go unnoticed by shoppers at local grocers or malls.
Rights bodies still await consumer complaint
Despite rising concerns about shrinkflation, consumer protection agencies haven't yet received any official complaints.
The Directorate of Consumer Rights Protection, a quasi-judicial government department responsible for hearing and addressing consumer complaints over goods and services, said that they were yet to receive any complaint on such matters.
"We take action upon complaints. And so far no such complaints about a reduction in weights of goods have been received," Mr Masum Arefin, a deputy director of the government agency, told the FE.
Similarly, the Bangladesh Standards and Testing Institution (BSTI), responsible for ensuring food safety and quality, reports no complaints.
A senior BSTI official said they have limited products having certifications that they look after.
Like the Food and Drug Administration (FDA) of the US, the BSTI is responsible for protecting and promoting public health in Bangladesh through market control and supervision measures.
"We have issued 277 licences against the consumer products, we look after the products as to whether they are using cheaper ingredients or not," Md Nurul Amin, a director (CM) of the BSTI, told the FE.
"We conduct regular inspections and haven't encountered any use of cheaper ingredients or reduced quality due to inflation."
However, Mr Amin said if anyone files a complaint, they will test the product in the labs and take necessary action.

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