FISCALLY FIT
‘Honey, I shrunk the…’
SHYAM P.
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To combat rising inflation and expenses, many FMCG manufacturers have started dropping a few grams from their products which you wouldn’t notice unless you read the fine print.
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If the rising cost of food grains and petrol isn’t enough to drill a hole in your pocket, here’s another reason for your blood pressure to creep up: Fast Moving Consumer Goods (FMCG) manufacturers have been quietly shrinking the size of t
heir products. Or even better, launching new variants that deviate from the standard packaging size so that you are tempted to try the new variant without even noticing that you are getting much less for the same money.
That’s right, your weekly bag of groceries is getting lighter. To combat rising expenses and inflation, many manufacturers have started dropping a few grams from their packages without notice (of course, the fine print on the cover mentions the reduced quantity but who reads these things?)
Less for the same price
Products hit by what I like to call “Honey! I shrunk the groceries” phenomenon includes milk products, cereal, chips, ice cream, soaps, shampoos and more. Some products are shrinking by as much as 20 per cent. You’re left with paying the same price or even a little less, but getting “significantly” less. Looks like the geniuses in the marketing departments of these consumer giants have figured, “Geez! I am going to insulate my customers from price increase: Imagine how many loyalty points our company can earn if only we can give less of the product for the same price”. Yeah! Right! Surely an innovation befitting the Nobel.
An excellent case in point is a popular malt beverage company that introduced a variant for the “fairer” sex. My missus, as usual, picked the new product off the shelf and into her shopping cart without batting an eyelid (I have always wondered why she should not enrol herself as a bona fide product sampler — at least we would get paid for the experimentation). All I could remember next were her screams from the kitchen as she emptied the contents into the regular container. Yes, it barely filled more than half. She immediately summoned me to calculate the cost per gm of the new product versus the original one and God! I should say I am generally above average in mathematics but I needed a calculator to solve the mystery.
The next week when I went to the supermarket, I could suddenly notice a mushrooming of smaller packs across products. I immediately picked up the phone and called my friend in the retailing industry. Here is what the professional had to say: “Most FMCG companies pass on the cost inflation to consumers, via a judicious blend of price hikes, packaged size reduction and change in product mix. Our research shows that few consumers react by down-trading to cheaper products, when they are offered ‘Value packs’ that offer a smaller quantity instead”. Wow!
To heal myself from the aftershock of hearing the theory behind organised manipulation of us gentiles by smart marketers, I decided to treat the missus and self in our favourite Chinese restaurant (Yes, in return for getting her to promise that she will never buy the malt beverage again — ever). But as destiny would have it, any dreams of gastronomic induced healing had to be postponed. Instead of the usual copious serving portion of Vegetable Fried rice with a side dish that could easily satisfy two hungry Indians, what we got served on the table was a much smaller container with just enough quantity for one. Now it was my turn to scream! Here too, Brutus!
This reminds me about a recent policy where a particular State government has promised to offer raw materials to restaurants at “ration prices” in return for an agreement on “price” maintenance. May be they should now include “quantity” in the MOU.
Extensive applications
I have thought of some other ways this “Honey, I shrunk the food” idea could be leveraged for solutions to India’s financial problems:
We won’t have to pay Rs. 50 a litre for petrol, if the amount of fuel in a “litre” shrinks down to only 750 ml. It’s a minor 250 ml difference and would lower the cost to Rs. 37.5/ litre, which is even lesser than the previous prevailing price of Rs. 45/ litre. Wish our beloved PM had thought of this idea to appease the Left. Think of how happy the lower price could make everyone feel!
Worried about rising EMIs on your home loan? Why not just chop off the extra bedroom from your home? Maybe your bank will even reduce the EMI in return for the juicy offer.
On the plus side, the rising cost of consumables may just help us “Value size” ourselves by consuming less. The result could be better than what any fitness gym can offer.
This continues to be a personal finance column. You may e-mail your feedback to: shyamscolumn@gmail.com
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