When confronted with mounting cost pressures, companies often choose to downsize their product volumes rather than increase prices—a move that consumers might resist, resulting in a hidden price hike. (Image courtesy of Yonhap)
SEOUL, Nov. 13 (Korea Bizwire) – During periods of inflated prices, a phenomenon known as “shrinkflation” emerges, wherein companies opt to decrease the quantity of their products instead of increasing the price. This term, a fusion of “shrink,” implying a reduction in quantity, and “inflation,” signifying a rise in prices, reflects this strategy.
When confronted with mounting cost pressures, companies often choose to downsize their product volumes rather than increase prices—a move that consumers might resist, resulting in a hidden price hike.
In response, industry experts and consumer advocacy groups advocate for enhanced transparency between companies and consumers regarding product alterations.
For instance, Pulmuone recently reduced the number of pieces per bag of its hot dog products from five (500 grams) to four (400 grams) while maintaining the same price, a change that only came to light in the media days ago.
Pulmuone recently reduced the number of pieces per bag of its hot dog products from five (500 grams) to four (400 grams) while maintaining the same price. (Image courtesy of Yonhap)
Similar alterations have been observed in other brands like Lotte Wellfood, Nongshim, Dongwon F&B, and Haetae, which also downsized product size or quantity without notifying consumers.
In online discussions regarding the repercussions of “shrinkflation,” especially in cases like Pulmuone’s hot dogs, a prevalent sentiment emerged. Many expressed the need for legislation in Korea requiring companies to inform consumers about changes in product volume without price adjustments, akin to policies in other nations.
Critics argue that companies tend to advertise increases in serving sizes but discreetly reduce product quantities without proper notice, creating a deceptive scenario for consumers.
While some countries have implemented measures to prevent undisclosed reductions in product weight, there’s a growing call for similar regulations in Korea. Jeong Jeong-yeon, the secretary general of the Korea Consumer Federation, highlighted the concern that subtle reductions in product quantity effectively amount to increased costs for consumers, fostering a sense of deception.
Jeong also emphasized the necessity for clear signage in stores to aid consumers in recognizing these alterations and proposed governmental accountability measures to ensure transparency from manufacturers.
In a separate incident in September, the French supermarket chain Carrefour faced criticism for displaying “shrinkflation” warnings for products that underwent volume reductions without price cuts.
Ashley Song (ashley@koreabizwire.com)
