As most of you reading this are probably well aware, the insidious tax that is inflation can come in many shapes and sizes. The two main ways that it is manifested in our everyday lives is via price increases and shrinking portion sizes/lower quality. I have noticed a lot of both in recent months but it is becoming apparent to me that the shrinking portion strategy has taken off into the stratosphere, at least for me in my everyday life.
It is this latter method of passing on inflation that really drives me up the wall. While transparent price increases are clearly annoying, at least it is fairly clear to the consumer and he or she understands what has happened and that there may or may not be an economic choice at hand. In the case of shrinking portion sizes, the price signal is much more subtle if present at all. You may notice yourself going back to the grocery store more often but that might be all you recognize at first. It is especially hard to notice in the early phases of inflation when the package size may shrink by 3% and the price increase 2% for example. It’s only in the intermediate stages of the inflation that you really start to notice you are being screwed. I believe we have entered that phase.
I can’t speak for anyone else but I can tell you what I am seeing in my everyday life here in Boulder, Colorado. In the last three or four months I have noticed a distinct change in the meals I have ordered at some of my favorite restaurants. More often that not, I now find myself sitting down to a plate half filled with french fries or a side salad. The main protein portion of many of the dishes I order is experiencing an incredible shrinking process. Last night the piece of fish that was supposed to be the centerpiece of my meal was microscopic (I should have taken a picture). Just a couple of days prior the sandwich I order at one of my favorite spots downtown had noticeably less meat in it and considerably more lettuce. The bread was also different and much less tasty (although I’m hoping this was a one-time thing – I voiced my opposition).
While all of this has been getting on my nerves (clearly) the worst part about noticing this trend is what it does to the relationship between the consumer and the restaurant or deli owner. Once you notice what the proprietor is doing you can’t help but experience some degree of negative emotion toward them. You know what they are doing and they know what they are doing and you know they are trying to be sneaky about it. At least when they raise the price it’s right in your face and no one is trying to be cute. It’s like inflation’s version of kicking the can down the road.
This is of course not just happening in the realm of food. Last weekend I flew to LA to visit a friend and the brownshirts (TSA) confiscated the sunscreen I had forgotten was in my bag. It was an ounce over the limit. Another terrorist attack foiled! Boy do I feel safe. In any event, I had just purchased the sunscreen a couple of months prior. When I went back after my trip to reload I couldn’t believe my eyes. All of the tubes were only 75% filled with sunscreen. These are the soft tubes so when they are empty the sides push in. It was very obvious compared to the full tubes I had seen the last time I was in there. It wouldn’t have really gotten under my skin if not for the fact that I have been noticing things like this almost every day now.
So what’s the point of this tirade? I am noticing the shrinkage effect to such a degree these days that I think we are near the point where an overemphasis on this strategy can no longer proceed at the pace it has been moving. I think many food establishments and consumer products makers have taken this close to as far as they can and more overt price increases are coming, and if they aren’t then those that continue this game will face increasingly frustrated patrons. For example, I’d personally rather go to a place that raises prices and keeps the quality and sizes of the items intact. Of course it all depends on the product, ie that rule doesn’t apply to places that specialize in low prices. However, I will say this. If you are in the business of producing a high quality product don’t skimp. People will notice and they will be pissed.