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Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

theguardian.com

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Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#351

Post by Gigachad »

tyingq wrote: post #72
hnarn wrote: post #62

I don’t know what the correct term is in English but in my country, “comparative pricing” is mandatory, so when you’re buying coffee for example there’s a secondary price listed that tells you what the cost is per kilogram or whatever other unit makes sense. For me this already solves the problem, because what I really care about isn’t whether I get 500g or 400g of coffee, I care about the real price compared to the…

You do miss though, those situations where every supplier took advantage of inflation to stack extra margin on. Seeing that diff to the last price is helpful.

Helpful in what way? The prices 6 months ago are no longer available so how does it help to see them?

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#352

Post by wholesomepotato »

h1fra wrote: post #69

For those wondering if it's truly representative, it's estimated that 50% of the inflation in Europe is due to margin increase not bc of the inflation itself. https://www.imf.org/en/Blogs/Articles/2023/06/26/europes-inf...

[flagged]

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#353

Post by tyingq »

Gigachad wrote: post #351
tyingq wrote: post #72

Earlier quoted context omitted.

You do miss though, those situations where every supplier took advantage of inflation to stack extra margin on. Seeing that diff to the last price is helpful.

Helpful in what way? The prices 6 months ago are no longer available so how does it help to see them?

Can't tell if you're serious. People on a budget want to know which line item increases are driving the overspend in the "grocery" category. So they can take some action to counteract it. Source that item elsewhere, consider store brands for that item, do without that item, etc.

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#354

Post by chromoblob »

milesvp wrote: post #219
josu wrote: post #171

Earlier quoted context omitted.

Do not buy into that narrative. This inflationary process has been mostly driven by monetary policy. Margin increases are the result of businesses trying to navigate an inflationary period. These margin increases are not resulting in increased profits across the board (there are some notable exceptions). For example, Carrefour's profits in 2022 were about the same as in 2019. [1] From the article you linked: "Profits…

Without a doubt monetary policy has fueled inflation, but do not ignore the policies of allowing corporate mergers for the last 40 years. Lack of competition reduces price elasticity, and the end game of every monopoly is to raise prices. We are living in a world of global monopsonies, and my expectation is to contine to pay this monopoly tax for years. Worse, is it’s never been easier to collude. It used to be you h…

Thanks for the collusion/dilemma tip, I didn't know.

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#355

Post by BlueTemplar »

hedora wrote: post #94
BlueTemplar wrote: post #67

Earlier quoted context omitted.

Well, you can (and should!) check the (mandatory) price/mass or price/volume, but of course there are very smart people being paid a lot to design the packaging so that it's sufficiently compelling for you to still put a higher value on the product...

Expecting people to memorize the per-unit price of everything they buy and compare week to week is unrealistic. Also, at least in the US, the price/weight for the same type of item is often in different units. ($/oz for brand A; $/lb for brand B, etc)

Well, after a while I do roughly memorize it for the things I buy the most, don't you roughly remember the non-per-unit price if that is what you are looking at ?

But that was not my point, the price per unit is to compare similar products with each other in the span of a minute or so.

Because if they are ALL going up (or down), then there are clearly external factors to that price change. At worst it's the fault of the supermarket (and here remembering the rough price/unit comes handy, for comparisons in others), or an issue with a monopoly/cartel collusion, in which case hopefully consumer associations are going to start whistleblowing, leading to government handing out punishments.

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#356

Post by anigbrowl »

enoch_r wrote: post #322
anigbrowl wrote: post #300

Earlier quoted context omitted.

It's the same with corporate profits. LMAO no. It's foolish to equate an individual selling a single asset like a car with businesses that can range from little niche supply workshops up to dominating whole industries. Pure laws of supply and demand only hold true under conditions of perfect competition , and much of what we call 'business' is about playing the meta-game - out maneuvering competitors financially, cre…

My claim is that we can't determine what caused a price change by looking at the distributional effects of that price change. I demonstrated this with an example, where we know what caused a price change (supply chain issues for a substitute product plus increased demand) and know the distributional effect (higher margins for sellers of used cars). If we naively try to explain the price change based on the distributi…

For some goods (like cars) supply issues have indeed been the major driver of price inflation.

But for many consumer goods, manufacturers have exploited the perception of inflation to increase prices or (as highlighted in the source article) to shrink package volumes while retaining the same price point. It's much less clear that supply is the driver here; bear in mind the fact that moving to smaller package sizes often imposes considerable overhead as whole production lines need to be retooled, new package containers designed and manufactured etc. It's not a passive response to market phenomena, it's a straightforward investment in the idea of giving consumers less value for their money.

While I don't disagree that government policy and economic shocks can often be inflationary without any intention on the part of the business community to drive prices up, consider too that sometimes there is such intent and organizations like the Chamber of Commerce exist largely to beg for support from the public purse in hard times and deflect criticism onto whatever scapegoats are convenient in good times.

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#357

Post by astrange »

yladiz wrote: post #343
astrange wrote: post #301

Earlier quoted context omitted.

> How do you reconcile your numbers with that? https://www.nber.org/system/files/working_papers/w31010/w310... It doesn't matter what the minimum wage is though, it matters what people are actually paid. Denmark doesn't have a minimum wage and they're doing okay. > Bills have outpaced wages to the point nearly a whole generation of young adults have given up on home ownership and have had to move back home. Not true,…

> Denmark doesn't have a minimum wage and they're doing okay. It’s more complicated than that, and you know it, or you’re using that fact to further your point somewhat disingenuously. Yes, there in no minimum wage defined by law, but in practice it’s around €20 due to the collective bargaining agreements (read: unions) in most industries.

So it doesn't have a minimum wage.

There's nothing to hide here. Just look at the median wage in both places. Or in this case, the lowest 10% wage.

I prefer Australia's wage board system, but I think nobody knows how it works because they're Australian so they've given stupid names to everything. Try and guess what "award" and "casual loading" mean.

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#358

Post by yladiz »

astrange wrote: post #357
yladiz wrote: post #343

Earlier quoted context omitted.

> Denmark doesn't have a minimum wage and they're doing okay. It’s more complicated than that, and you know it, or you’re using that fact to further your point somewhat disingenuously. Yes, there in no minimum wage defined by law, but in practice it’s around €20 due to the collective bargaining agreements (read: unions) in most industries.

So it doesn't have a minimum wage. There's nothing to hide here. Just look at the median wage in both places. Or in this case, the lowest 10% wage. I prefer Australia's wage board system, but I think nobody knows how it works because they're Australian so they've given stupid names to everything. Try and guess what "award" and "casual loading" mean.

It doesn’t have a de jure minimum wage, but it does have a de facto one, and just saying it doesn’t hides the subtlety of that.

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#359

Post by WalterBright »

mitthrowaway2 wrote: post #348
WalterBright wrote: post #345

Earlier quoted context omitted.

That is called the "cost-push" theory of inflation, and its giant problem is it doesn't explain where the extra money comes from that is necessary for sustained price increases across the economy. It's sibling is "demand-pull" where customer demand causes inflation, but it equally does not explain where the extra money comes from. A theory that does explain it is the government dumping cash into the economy - inflati…

(I'm sure you're aware of this, but price increases only require increased spending from customers if transaction volume is held constant. It's entirely possible for prices to rise to arbitrary heights even as the economy contracts and customers become poorer, either because supplies dry up, or because high-volume demand dries up and companies are forced to shift to a smaller but wealthier customer base with high spe…

> I'm sure you're aware of this, but price increases only require increased spending from customers if transaction volume is held constant

Reduced demand reduces prices. It's the Law of Supply & Demand at work.

The Law is always at work, even money is subjected to it. Increase the supply of money, and the value of a dollar drops accordingly. We see this effect as inflation.

In physics, we know that momentum is conserved. Any theory that deviates from that is wrong, even if we can't figure out why it is wrong.

Analogously, any economic theory that results in a "free lunch" is wrong. Any economic theory that denies the Law of Supply & Demand is also wrong. Bad government economic policies are nearly always the result of denying the existence of the Law of Supply & Demand, which is as doomed as denying the Law of Gravity.

Nothing stops the government from pretending that deficit spending is a free lunch, and they sell that notion at every opportunity. But the Law of S+D still applies.

The elephant in the room is the sheer size of the several trillions in deficit spending. There's just no way to ignore it and explain inflation away by suddenly every business is price gouging. It's not a compelling explanation at all.

Re: Carrefour puts ‘shrinkflation’ price warnings on food to shame brands

#360

Post by mitthrowaway2 »

WalterBright wrote: post #359
mitthrowaway2 wrote: post #348

Earlier quoted context omitted.

(I'm sure you're aware of this, but price increases only require increased spending from customers if transaction volume is held constant. It's entirely possible for prices to rise to arbitrary heights even as the economy contracts and customers become poorer, either because supplies dry up, or because high-volume demand dries up and companies are forced to shift to a smaller but wealthier customer base with high spe…

> I'm sure you're aware of this, but price increases only require increased spending from customers if transaction volume is held constant Reduced demand reduces prices. It's the Law of Supply & Demand at work. The Law is always at work, even money is subjected to it. Increase the supply of money, and the value of a dollar drops accordingly. We see this effect as inflation. In physics, we know that momentum is conser…

> Reduced demand reduces prices. It's the Law of Supply & Demand at work.

You have to be careful when asserting this though, because demand does not mean what most people think it means. In particular, it does not refer to the number of people demanding a good, nor does it refer to a volume of goods purchased. A declining sales volume occurring together with rising prices does not violate the law of supply and demand.

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