Products on shelves are getting quantifiably smaller, yet you’re paying the same price: a practice known as ‘shrinkflation’. But in addition to shrinking products, businesses are also cutting back on the quality and availability of their services, while keeping prices steady. This is called ‘skimpflation’ – and although the changes are sometimes significant, they often fly under the radar.
“Skimpflation is defined as businesses ‘skimping’ on the quality of a product or service,” says Scott A Wolla, economic education officer at the Federal Reserve Bank of St Louis. As raw prices go up with inflation, businesses skimp by spending less on services or materials to stay profitable – cuts that get passed down to the customer, even as prices remain stable.
In grocery stores, explains Balagtas, it’s now common for customers to bag their own items at checkout instead of having a clerk do it for them. The number of self-checkout stations has increased around the world, with fewer workers available to help customers pay – a change some consumers construe as a degradation of service.
Grocery aisles are also rife with skimpflation. Along with shrinking size and quantity of products, food manufacturers are applying skimpflation to the quality of goods to reduce costs. Often, this includes swapping out expensive, premium ingredients for cheaper, lower-quality ones while keeping the same price tags, or even raising them. To save money, for instance, Balagtas says some ice cream manufacturers have reduced some of the expensive milkfat in their products, instead replacing them with “other ingredients, including water and other components of milk, but also sweeteners”, says Balagtas.