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The flip side of inflation: "Skimpflation" is hitting everything from food to hotels

Holiday shopping starts early amid inflation
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The hottest inflation in 40 years has prompted manufacturers to resort to "shrinkflation," a cost-saving tactic to reduce the size of packages while keeping the same price. Now, businesses are trying another way to save money: "skimpflation."

Some companies are reformulating their products using cheaper ingredients to reduce their manufacturing costs, a stratagem some have dubbed skimpflation, according to consumer advocate Edgar Dworsky, the founder of Consumer World. The change typically isn't communicated to consumers, who may be unaware of the ingredient change yet are charged the same price for the product.

One recent example of skimpflation that consumers did notice involved Conagra's Smart Balance spread, a dairy-free butter substitute. Conagra recently changed its formulation to reduce its share of vegetable oil from 64% to 39% — an almost 40% reduction in vegetable oil. 

But Customers who noticed the switch have flocked to the Smart Balance website in recent days to complain about the new formulation, calling it "terrible," "disgusting" and "undesirable."

"We have been loyal Smart Balance customers for a long time, but something changed," one customer wrote as part of their one-star review on Monday. "It is now really soft, spits all over when frying an egg and doesn't melt on toast. Just as bad, it is over $10 now for the big tub. This tub is headed for the trash."

A spokesman for Conagra said the company had changed the Smart Balance products formulation "to make them easier to spread." He added, "We have heard the feedback from consumers and have decided to return to the previous recipes in the coming months."

Skimpflation may save costs or even boost a company's bottom line, at least in the short term, but it also risks turning off consumers, who may seek alternatives that they view as providing a better value or quality, Dworsky said. Some angry Smart Balance customers vowed in their reviews that they would switch brands because of the perception of poor quality after the recipe change. 

"It's hurtful in the economic sense that you are getting a little less quality for your money, and it hasn't necessarily been clearly disclosed," Dworsky added. 

Toilet paper change

Another product flagged by Dworsky as an example of skimpflation is Scott 1,000-sheet toilet paper, which has drawn negative reviews on its website for what consumers say is a decline in quality. 

"The quality has gone…well…down the toilet! This is NOT the Pre-pandemic Scott," one consumer wrote on Scott's site in September. "The sheets are so thin they're transparent. I don't even think they are a full ply. 1/4 ply at best."

Kimberly Clark, the manufacturer of Scott toilet paper, didn't respond to a request for comment. 

Dworsky said he happened to have an older package of Scott 1,000-sheet toilet paper at his home, and also bought a new package. He weighed the two packages and adjusted for the change in length for the rolls. Using an apples-to-apples comparison, he found that the new rolls weigh 20% less than the older ones, he said.

"It wasn't just the consumer perception that the product had gotten thinner — it really did," he said. "How would a consumer know looking at the package? You wouldn't."

Companies in the hospitality industry are also skimping out on consumers, such as hotels that have cut back on housekeeping services during the pandemic. 

Hotels cut back on services during the pandemic, partly in response to difficulty in hiring staff and as revenue dropped due to shutdowns and other challenges. Daily housekeeping still hasn't returned at some hotels, even as they continue to charge the same price, according to the St. Louis-Dispatch.

"There is more incentive now [for skimpflation] because manufacturers' bottom lines are being pinched and they are looking for ways to save money," Dworsky noted. 

"It's not illegal," he added, but said customers may think twice before using the product again.

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