Here’s how to avoid shrinkflation and make the most of your budget
Here in the US, inflation increased by 8.5% between July 2021 and July 2022. As inflation drives up costs, you may have noticed other changes in your shopping cart due to shrinkage inflation.
Shrinkflation occurs when the product size shrinks but the sticker price remains the same. It’s a relatively unobtrusive way for companies to maintain their profit margins without increasing the price of a product.
At first glance, it can be difficult to tell the difference on a supermarket shelf. But the result of shrinkage inflation is that you have to spend the same amount of money on a smaller amount of a given product. And you’ll quickly see how this affects your purchases.
With most feeling the pinch of inflation in their wallets, shrinkflation is an unwelcome development.
If you’re concerned about the impact of this phenomenon on your finances, let’s explore some ways you can avoid shrinkage altogether.
Forsake brand loyalty
Many of us are creatures of habit. But when the shrinkage hits, it might be time for a change.
Micheal Collins, Professor at Endicott College and Founder of WinCap Financial, says: “Just because you’ve always bought a certain brand doesn’t mean it’s still the best value for money. Be open to trying new products and brands, especially when they’re on sale.”
If a similar product offers better value for money, it might be worth changing your shopping list.
Try generic products
When looking at the other branded options, don’t overlook generics.
According to Matt Gray, CFP, buying your own brand is a way to get a better price for a nearly identical product. Gray explains, “Usually private label is still made by a big manufacturer and they buy it from them and rebrand it so the products are still good.”
According to a study by Consumer Reports (opens in new tab) As early as 2012, many private labels were considered equivalent in taste to their branded counterparts.
If you’re looking for savings, many generics offer both quality and price.
Find out the price per unit
When purchasing a product, pay attention to the price per unit. Collins says: “The unit price (e.g. price per 100g) can help you compare products of different sizes and ensure you’re getting the best value for your money.”
Normally the unit price is readily available on the supermarket shelf. If not, you can do calculations by dividing the total price by the quantity. For example, if a dozen eggs cost $5, the price per egg is 41.6 cents.
shopping spree
When you buy a specific product, different stores may offer different prices. So it might be worth looking around.
Maggie Tucker, co-host of the Friends on FIRE podcast, recommends rethinking where you spend your money. She says: “Consider switching to a discounter like Aldi, where the own-brand products are of high quality and significantly cheaper than other brands and stores.”
Stock up during the sale
If you spot a good deal, stock up on supplies if possible, as non-perishables are easiest to store when you see a sale. For example, if you find cleaning products or paper towels on sale, you can make worthwhile savings.
In most cases, storing perishables is not an option unless you want to freeze some of your groceries.
To find the best deals, check out the weekly flyers and grocery coupons from the various supermarkets in your area.
Personally, I jump at the opportunity to stock up when I see a buy one get one free sale on pantry items that my household uses regularly.
use coupons
Sometimes couponing gets a bad rap as a time-consuming task. But the reality is that a minimal investment of time can result in worthwhile savings.
Andrew Latham, SuperMoney CFP and Content Director, says: “Coupons can save you a big chunk of change every month, but it only works if you use coupons on things you already wanted to buy and don’t waste hours on it .”
He advises, “Just remember that coupons are nothing more than ads designed to lure you into the store. If you clip a coupon for a product you were already planning to buy, you and the store win. You lose if you only buy one product because it’s on sale.”
Buy in bulk when it makes sense
The ability to buy in bulk can often help you lower your cost per unit. But it’s not always the right move for your budget. After all, you have to spend more upfront to get the discount.
John Brown, a former financial analyst and GetCash contributor, offers a solution for those who don’t have the budget to start a large bulk purchase: “I suggest you coordinate with those around you – family, neighbors, co-workers and friends – with similar food preferences or diets. You can list important items together and designate a person to shop.”
Brown shares that “it saves you money because you only get what you need and no more.” While it’s a bit more complicated than most shrink strategies, it could help you make significant savings without breaking your grocery budget to strain a shopping spree too much.
Try your hand at DIY
Another way to avoid the pinch of shrinkage is to avoid buying it altogether by making the product yourself.
Tucker says, “You can save hundreds and maybe thousands a year by making your own cleaning and laundry products at home.” Simple recipes are accessible with a quick internet search. Or check out our own DIY cleaning product recipes.
However, make sure that the cost of making the product, including your time, does not outweigh the potential savings.
Face the shrinkage head-on
Shrinkflation puts pressure on already tight budgets. When your budget is tight, you need to face the challenge head-on.
Although it might require some changes in your normal shopping habits, it’s possible to avoid the brunt of shrinkage with smart shopping strategies.
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