France’s Carrefour to Add ‘Shrinkflation’ Label to Products in Latest Food-Price Spat

livemint.com:

Carrefour is set to attach labels to products sold in its stores warning shoppers of what it deems to be “shrinkflation", the latest volley against the major food producers accused of trying to profit from inflation. From Monday next week, all products that Carrefour claims to be practicing shrinkflation—when a product has become smaller but the price charged by the supplier has risen without changes to the recipe or packaging—will be labeled as such, the French supermarket chain said Friday. The bright orange label, measuring about five square inches, also informs consumers that Carrefour is committed to re-negotiating the price of the product in question.

Examples of products to be shrinkflation-labeled include Nestle-made coffee capsule Dolce Gusto Grande Intenso, which has risen in price by 8% while shrinking in volume, according to Carrefour. Others include Lay’s potato chips and Lipton ice tea, both made by PepsiCo, and Amora mayonnaise, made by Unilever, the supermarket said. The move will offer “the most reliable information possible," for consumers, Carrefour Chief Executive Alexandre Bompard said.

Shrinkflation is an “unacceptable practice," he said. None of the three companies responded immediately to a request for comment. Switzerland-based Nestle, Anglo-Dutch Unilever and U.S.

giant PepsiCo are three of the world’s most important packaged-food giants, producing a vast range of the best-known consumer food and drink brands. All three have previously said this year they raised prices in many markets to offset slipping volumes. Higher prices have boosted their respective top lines and protected margins amid rising cost inflation.