As I’ve mentioned in other articles, inflation doesn’t always show up for the consumer as higher prices, as many imagine—especially since competition forces brands to keep prices low. In some cases, the product itself doesn’t cost more, but the package contains fewer units or smaller weights and measures than before, which is exactly what’s happening right now in Brazil and around the world.
In practice, this phenomenon is known as “shrinkflation.” It’s a commercial strategy: shrink the product so you don’t have to raise the price. But in reality, it ends up costing the consumer more, because you get less quantity for the same amount of money. Here’s a question: don’t you find it odd that the environmental argument to “remove chargers from cell phones” never comes with a proposal to “reduce the product’s price”? Food for thought…
Back here in Brazil, millions of Brazilians are already living with inflation accumulated at 9.68% over 12 months and are complaining about ever‑smaller products. For instance, egg cartons no longer hold a dozen; chocolates and cookies have shrunk; laundry detergent lasts for fewer washes. These are just a few practical examples of how manufacturers are adapting.
By national law, companies must announce any reduction on the packaging. However, consumer protection agencies say that notice isn’t always clear enough. In the State of São Paulo, for example, if the disclosure is too small, the consumer can demand a full refund. Did you know that?
Shrinking the Paçoca Drastically
Not even paçoquinha—a Brazilian favorite now exported worldwide—has escaped inflation. One of Brazil’s largest manufacturers, Santa Helena, told UOL that it cut 4 g from its rectangular packages, including the Cuida Bem brand. According to Santa Helena, this reduction is due to inflation in raw materials, as peanut prices rose by 50% and packaging costs by 39%.
Rice and Sugar Packages Are Smaller
Besides paçoca—and many chocolates that shrank from 110 g to 90 g—sweet‑tooth consumers have felt shrinkflation even in sugar packages, now sold at less than 1 kg. It’s bizarre and alarming, say many shoppers.
Outro dia, fui enganado (🤡) por um saco de açúcar refinado. Geralmente, estamos acostumados com pacotes de 1kg, sem que haja embalagem diferente, com peso diferente. Paguei dez centavos a menos por um saco de açúcar refinado de OITOCENTOS GRAMAS. Grande “economia”. pic.twitter.com/2BrbyqMEJv
— Thiago C. (@thiagoch8) July 16, 2021
But Juan, how to solve this problem? I wish I had a simple, one‑size‑fits‑all answer to such a huge, multifaceted issue. For now, the most important step is to invest your money wisely according to your means—so you can offset that +10% inflation gap in Brazil. Diversification is key to balancing your portfolio and reducing the impact of inflation on your life or business.
And you, what did you think of this article on inflation?
Photo by Pixabay
