How FMCG Companies Tackle Shrinkflation While Maintaining Product Standards

How FMCG Companies Tackle Shrinkflation While Maintaining Product Standards

Pick up a packet of crisps you have been buying for years. It feels the same in your hand. Same branding, same price on the shelf. But something is slightly off. The bag is not as full as it used to be. The biscuit pack has two fewer rows. The juice carton that was 1 litre is now 900ml.

You are not imagining it. This is shrinkflation, and it is more widespread than most people realise.

What Shrinkflation Actually Is

The term is straightforward enough. Instead of raising the price of a product, a manufacturer reduces the quantity or size while keeping the price the same. The cost per unit goes up for the shopper, but because the shelf price has not changed, it tends to go unnoticed for a while.

It is not new. Shrinkflation in FMCG has surfaced repeatedly over the past few decades, usually whenever manufacturers get caught between rising input costs and a retail environment that punishes visible price increases. Raw materials get more expensive. Energy costs climb. Shipping disruptions push freight rates up. At some point, something has to give, and more often than not, it is the pack size rather than the price tag.

Consumers tend to notice a price change immediately. A pack that is 15g lighter takes a few shopping trips to register, if it registers at all.

Also Read: Understanding UAE's Changing Consumer Preferences in 2025: A New Era for FMCG Brands

Why a Price Increase Is Often the Last Resort

There is a specific discomfort that comes with raising the price on a product people buy out of habit. The moment a familiar number changes on the shelf label, shoppers stop, reconsider, and start looking sideways at the alternatives. Some switch. Some just feel annoyed enough that the brand loses a little goodwill it will never fully recover.

Shrinking the pack sidesteps most of that. The shelf price stays where shoppers expect it. The brand holds its position in the price tier it has spent years building. And the margin pressure gets quietly managed through less product in the box rather than more dirhams on the ticket.

FMCG shrinkflation strategies often come down to this calculation. Short-term customer retention compared to a transparency that might cost market share. Most brands, when forced to choose, opt for the quiet adjustment.

Retailer relationships factor into this too. Getting a price increase agreed and reflected across a retail network involves commercial negotiations, contract amendments, and timing constraints that can stretch over months. Adjusting pack specifications is a faster process on the supply side, even if it creates its own complications further down the line.

Where Product Quality Comes Into It

Shrinkflation product quality is where things get genuinely complicated, because the two pressures do not always stay separate. A manufacturer dealing with a cost crisis faces the same squeeze whether they are looking at pack size, ingredient quality, or manufacturing tolerances. The temptation to address all three at once is real.

The brands that come out of these periods with their reputations intact are usually the ones that treated size and quality as separate decisions. The pack got smaller. The product inside did not change. That distinction matters more than it might seem, because shoppers who accept a slightly smaller biscuit will not accept a biscuit that suddenly tastes different.

Some companies approach it differently again. Instead of touching the consumer-facing product at all, they absorb cost pressure through procurement, packaging materials, or logistics efficiencies that are invisible to the end customer. It requires more internal discipline and usually takes longer to execute, but it protects the one thing that is hardest to rebuild once lost: the sense that the product is still worth buying.

How Shrinkflation Shows Up Across Different Categories

It does not affect every category the same way. Snack foods and confectionery tend to be where it is most common, partly because portion expectations are loose enough that a small reduction goes undetected for a while. Personal care and cleaning products see it too, sometimes dressed up as a reformulation or a concentration improvement.

Fresh produce is a harder place to play these games. A 500g bag of rice that becomes 450g is obvious to anyone who cooks from scratch regularly. This is partly why shrinkflation in consumer goods is more prevalent in packaged and processed categories than in fresh ones, and why shoppers who pay close attention to fresh produce pricing often have a sharper eye for these changes across the rest of their trolley too.

Beverages have seen quiet shifts across bottle and carton sizes over the past few years. The changes tend to arrive alongside new packaging designs, which gives manufacturers a plausible frame for the adjustment that has nothing to do with cost.

What This Means for Shoppers at Al Maya

Al Maya Group works with a wide range of FMCG suppliers across its stores in the UAE, Bahrain, and Qatar. When manufacturers adjust pack sizes or reformulate products, those changes come through the Group's procurement process before they reach the shelf. The buying teams track specifications, and labelling reflects what is actually in the pack.

Unit pricing is the most useful tool a shopper has in this environment. The headline pack price tells you what you are spending. The price per 100g or per litre tells you what you are actually getting for it. When a pack shrinks but the shelf price holds, unit pricing is where that change becomes visible.

Own-label and store-brand products are also worth considering here. They do not carry the same brand equity pressures that push manufacturers toward these decisions in the first place, which means sizing and formulation tend to stay more stable across the cost cycles that drive shrinkflation in branded goods.

The Longer View on Shrinkflation Solutions

The brands that handle cost pressure without quietly degrading their products tend to share a few things. Longer supplier contracts that insulate them from short-term commodity swings. Enough purchasing volume to absorb volatility without passing it directly to the consumer. Forecasting discipline that means they are not making reactive decisions during a cost spike.

Consumer awareness has also shifted the risk calculation. Shoppers today talk about this stuff. A product that gets quietly worse gets noticed publicly in a way it would not have ten years ago, and that reputational exposure has started to show up in how FMCG companies plan their responses to cost pressure.

Retailers that serve those shoppers well make comparison easy, keep labelling honest, and stock alternatives that give customers a genuine choice. At Al Maya, the next time you are comparing two similar products on the shelf, check the unit price first. That number is doing more work than the big one above it.