Shrinkflation in practice - implications for consumers, producers and the packaging market

Shrinkflating is one of the most commonly used, but rarely communicated, cost optimisation strategies in the B2C sector. While on the surface it can be a good solution, it sometimes becomes a double-edged sword that will stab the manufacturer the hardest. What is the mechanism of the phenomenon and how do consumers react to it?

Shrinkflation - what is it and why does it happen?

Shrinkflation is the phenomenon whereby the contents of packages are reduced (change in quantity, volume, weight of products) while maintaining the previous size of these packages and price goods on the shop shelf. It is a kind of hidden inflation - results in an increase in commodity prices per unit.

Shrinkflations most common in the FMCG sector, where consumers:

• make purchasing decisions based on the price of the product on the shelf,
• do not always glance at the unit price written in small print.

At the heart of shrinkflation is the assumption that consumers are more sensitive to the transaction price of products than to changes in their package size. For this reason, entrepreneurs struggling with rising production costs prefer to reduce the amount of product in the package rather than raise prices on shop shelves. Furthermore, research shows that many consumers do not read product labels, especially if they are already familiar with them and buy them regularly.

It can be assumed that producers are aware of consumers' low knowledge and lack of ingrained habit of reading labels on products, and they are counting on this - keeping the original price and size of the packaging, while reducing its content.

Source: UOKiK, Downsizing in the assessment of Polish consumers. Survey report, https://uokik.gov.pl/Download/641.

Shrinkflation is also sometimes referred to as shrinkflation or downsizing, which the consumer may find somewhat confusing. The term downsizing is commonly used in the automotive industry, where it means reducing the displacement of internal combustion engines while maintaining or even increasing their power output. Such downsizing aims to reduce emissions and consumption of fossil fuels, which brings environmental benefits. Downsizing in the FMCG industry seems to have the opposite effect.

Is less is more? The environmental impact of shrinkflation

Related to shrinkflation a reduction in the weight of the product does not usually go hand in hand with a reduction in the weight of its packaging (so-called. lightweighting). Producers tend to forgo any changes in packaging dimensions and appearance in order not to arouse consumer suspicion, to maintain their current position on the shop shelf and to avoid the costs associated with redesigning sales packaging, bulk packaging and the entire packaging line. As a result the weight of packaging material per unit of product increases and the weight of packaging waste generated per kilogram, litre or piece.

An additional factor contributing to the increase in packaging waste is the change in consumer shopping habits forced by the reduction in product weights. In order to maintain the current level of consumption, the customer needs to buy more packs of the product, and this in turn leads to an increase in the total mass of waste generated from this packaging. Given that shrinkflations typically involve products that are consumed or used in large quantities (e.g. food, beverages, cosmetics, household chemicals), the increase in the mass of packaging entering the waste stream can be significant.

However, the environmental impact of shrinkflation does not end with the need to manage more waste, but also extends to the entire life cycle of packaging and the range of environmental responsibilities associated with its use.

• Production of additional packaging quantities requires increased consumption of raw materials and energy and leads to increased emissions.
• The environmental burden of transport is also increasing slimmed down products in unchanged packaging - to deliver the same amount of product to a shop or household, transport companies and consumers have to travel more kilometres using more fuel and emitting more greenhouse gases.
• More weight of packaging introduced means higher charges on account of ROP. At the moment in Poland, they boil down to a higher price for a packaging recovery organisation to take over the recycling obligation, but this state of affairs will not last forever. The government is still working on a new ROP model, and increases in fees for each kilogram of packaging introduced are rather inevitable.

Back to the question in the headline - yes, less product (usually) means more. More waste, more emissions, more raw materials used and... more dissatisfied consumers.

About consumers

Research clearly shows that consumers are not indifferent to shrinkflations - In a recent survey by the European Association of Paperboard and Cardboard Manufacturers, Pro Carton, 39% of them declared that they were „very concerned” about reducing the amount of product in a pack without changing the price. Even more, 80% of those surveyed would look unfavourably on a brand that had quietly slimmed down its product. In practice, this means that:

• 50% consumers will start looking for alternative products with a better price/weight ratio,
• 31% will immediately switch to another brand's product,
• 11% will continue to buy the same product,
• 8% is not sure what it will do.

At the same time, as much as 21% consumers will stop buying the slimmed down product[i].

Such unequivocal reactions mean that a manufacturer planning shrinkflation needs to think carefully about its communication strategy. The public does not accept the clandestine downsizing of products - instead, it demands reliable information not only about the application itself downsizing, but also about the reasons for doing so. What is more, there are bodies on the side of consumers defending their interests - the The UOKiK is sensitising manufacturers to clearly communicate the change in the existing product weights. Otherwise, such actions may be considered as deliberate misrepresentation. In some EU countries (e.g. France and Italy), regulations explicitly oblige manufacturers to inform about shrinkflations.

Shrinkflation vs. legislation - will PPWR affect the downsizing trend in FMCG?

Probably yes. However, the new regulations will not limit the scale of slimming products, but make it easier for consumers to see the difference in their quantity, weight or volume. PPWR Regulation This is because it establishes a requirement to minimise packaging, whereby a possible downsizing will include not only the product itself, but also its packaging. In addition, it introduces the reduction of the void ratio in commercial packaging to the minimum necessary, which should eliminate from the market packaging with double walls, double bottoms and other features designed only to conceal a real change in the quantity or volume of the product resulting from shrinkflation.

Out of concern for the brand's good name and consumer perception, it will be good practice in the coming years to combine shrinkflations with eco-design of packaging „slimmed down” product and with communication of the changes and the underlying causes. This attitude can bring many benefits to entrepreneurs:

• cost reduction related to the production process and reduce the consumption of raw materials,
• maintaining the current shelf price as the most important factor influencing consumer purchasing decisions,
• compliance with legal requirements, including those arising from the PPWR,
• increasing the recyclability of packaging resulting in a reduction in environmental charges.

[i] Pro Carton, The Power of Packaging What Makes European Consumers Trust, Stay, or Switch?, https://www.procarton.com/wp-content/uploads/2026/03/Pro-Carton-Consumer-Study-2026-Final-Edit-1.pdf