Grocery chain names and shames price-gouging suppliers

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Carrefour has added ‘Shrinkflation’ warning labels to products that have got smaller while prices remain the same

French supermarket Carrefour launched an unusual campaign this week, putting stickers on products to warn customers of “shrinkflation”. The step, both in stores and on its website, names and shames suppliers that have reduced the weight or volume of their products, while keeping prices unchanged.

Shrinkflation – also known as package downsizing – refers to the practice of reducing the size or quantity of a product, as a means for the manufacturer to cut costs while maintaining sales volumes.

This week, France’s second biggest grocery chain marked 26 products in its stores with labels reading, “This product has seen its volume or weight fall and the effective price by the supplier rise.”

Lipton Ice Tea, Lindt chocolate and Viennetta ice cream are among the products now being flagged, to put pressure on major consumer goods suppliers such as Nestle, PepsiCo and Unilever.

Carrefour found that the volume of can of Guigoz baby formula manufactured by Nestle has gone from 900 grams to 830 grams, while the weight of the Unilever-made Viennetta ice-cream cake has dropped to 320 grams from 350 grams. A bottle of sugar-free peach-flavoured Lipton Ice Tea, made by PepsiCo, has shrunk to 1.25 litres from 1.5 litres.

“Obviously, the aim in stigmatising these products is to be able to tell manufacturers to rethink their pricing policy,” Stefen Bompais, director of client communications at Carrefour, told Reuters.

Carrefour’s move comes as brands are about to negotiate their arrangements with certain retailers.

For more stories on economy & finance visit RT’s business section

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