In Germany, large manufacturers are secretly reducing the contents of their packs, but consumers pay the same amount at the checkout as before. Hidden price increases are passed on to customers now and in the future.
Unlike at the beginning of the Corona crisis or when the Ukraine war broke out, the supermarket shelves are now well stocked again. The same cannot be said of the packaging of large German food manufacturers. They are increasingly demanding more money for gummy bears, jam and co.
The procedure is simple: packaging that remains the same size is filled with less content. Alternatively, the manufacturers even offer more content per pack, only that the price increases as a percentage more than the pack content. This is called “shrinkflation”, made up of “shrink” and inflation. A single gummy bear from Haribo costs more today than it did two years ago. Armin Valet, food expert at the Hamburg consumer protection agency, told Focus Online when asked that supermarket purchases could become even more expensive in the future: “In the last two to three weeks we have received an enormous number of complaints from consumers. We are currently experiencing the first wave of such hidden price increases, which will certainly not abate in 2023 either.”
Some manufacturers sell less product for the same price and hope that buyers won’t notice. But it is not only in economically difficult times that consumers pay close attention when shopping. This is also registered by the consumer advice centres, where “deceptive packaging” from the retail trade has been criticized for years. Sabine Hülsmann, consumer advocate at the Bavarian consumer advice center, knows the problem only too well: “We have been receiving complaints from consumers for over ten years.”
On the manufacturer side there is always an interest in passing on hidden price increases via so-called “deceptive packaging”. “More expensive raw materials and supply chain difficulties lead to higher production costs. The higher prices could be passed on transparently to consumers, and the same amount of product would then be more expensive. Not doing that is a hidden price increase,” Hülsmann complains about the company’s strategy. But manufacturers are reluctant to have their products labeled more expensive: “Many people have gotten used to certain product prices, raising them could result in a drop in sales.” And food expert Valet adds: “Ultimately, consumers have to foot the bill.”
The “Consumer price index for everyday goods and services”, which the Federal Statistical Office compiles every year, sees a dramatic price development for food in all food groups:
There are many reasons for the increase in food prices: the costs of energy, fertilizer and animal feed have been rising massively for months, the shortage of workers and the minimum wage are driving up personnel costs. Food costs have been rising month by month since July 2021, with no end in sight. In July 2022, food inflation was 14.8 percent, twice the overall inflation rate, which was 7.5 percent.
But not all price increases are transparent, and far from all of them can be traced back to higher production costs. The consumer advice center NRW recently called on politicians and the cartel office to take a close look at food manufacturers to see whether they would not seize the opportunity to improve their own earnings. A random sample by the North Rhine-Westphalian consumer advice center at four large retail chains revealed significant price differences within the product groups. The price range for tomatoes was particularly striking, with a kilo selling for EUR 1.11 and EUR 22.17 on the same day. Wolfgang Schuldzinski, CEO of the North Rhine-Westphalia consumer advice center, is certain: “Such blatant price differences on the same day in different supermarkets cannot be explained solely by higher production costs, panic buying or the consequences of the Ukraine war.” The consumer advocate adds: “The sample proves it that food pricing is highly non-transparent and speculative. We therefore demand that the antitrust authorities be given more powers to check food prices and prevent possible price fixing.” And Valet adds: “They want to trick consumers.”
One of the manufacturers that has reduced its product quantities per pack and is charging the same price for it is the Haribo company. Extraordinarily rising costs for high-quality ingredients, foils, packaging materials, cardboard boxes as well as energy and logistics would have confronted the confectionery producer with immense additional costs. One therefore sees oneself forced to adjust both packaging sizes and prices. This will affect a large part of the Haribo product range: “For some of the items, the weight is reduced from 200 g to 175 g (e.g. Goldbären), for some items from 175 g to 160 g (e.g. Pico-Balla)”, he said a spokesman for the company when asked by Focus Online. “It was important to us that we no longer have “air” in the bag, i.e. keeping the size of the bag, but also making the bag visibly smaller. In this way, the reduction in filling quantity is clearly recognizable for consumers.”
Not all companies make their pricing policy so transparent. The Theo Müller group of companies, whose “paprika sauce” from Homann was voted deceptive packaging of the year by the Hamburg consumer center in 2021, was not ready to make a statement when asked by Focus Online.
Consumer advocate Sabine Hülsmann sees the “shrinkflation” not only as an economic but also an ecological problem: “You need more and more packaging to sell the same amount of product. Product packaging often remains the same size, only the content is less. That is not sustainable.” The food expert from the Hamburg consumer advice center also criticizes the increased volume of packaging: “The manufacturers outdo each other with sustainability reports, but in reality little is happening.”
Consumers can protect themselves against rising food prices with a few effective strategies:
