Do you like chocolate? You might be paying more for your favorite chocolate bar without realizing. In 2011, the Cadbury Dairy Milk bar sold in the
United States shrank by two squares, although its price remained the same. The company blamed higher costs including more expensive ingredients. In 2013, the corners of the bar were cut off too, not because rounded corners look better.
When companies charge the same, or more, for less, we have shrinkflation, which, according to Pippa Malmgren, former adviser to President George W. Bush, “may foreshadow an overall jump in prices.”
“Shrinking the size of goods is exactly what happened in the 1970s just before inflation proper set in,” Malgren says in her new book “Signals: how fast cialis works The Breakdown of the Social Contract and the Rise of Geopolitics.”
Why viagra sildenafil multiple sclerosis do companies do it? Many choose shrinkage instead of increasing prices when faced with higher costs.
Rob Dickerson, senior global packaged food analyst at Consumer Edge Research, told CNBC that he noticed a global trend of food manufactures making such changes to the sizes of products.
“By reducing the size of our 140g [Cadbury Dairy Milk] bar to 120g we have been able
to hold the bar at this price although we believe our confectionery still represents a very affordable treat,” said Kraft Foods, the company that bought Cadbury at the beginning of 2010.
Others in the food industry may use cutbacks for other reasons. Coca-Cola North America has started offering smaller cans and bottles but at higher prices not only to boost sluggish sales but also to offer healthier portions.
Shrinkflation is another form of inflation gnawing the purchasing power of your dollar. Gold and other precious metals are the classic inflation hedge. Contact one of Birch Gold Group’s Precious Metal Specialists to learn about investing in gold or visit our Facebook page for the latest news about the precious cialis what to expect metals market.
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