Morning Brew - ☕ Shrink shrink, nudge nudge

Supermarket products shrinkflation.
October 15, 2024

Retail Brew

Bandwidth

It’s Tuesday, and it’s already been a busy week for retail. True Value has declared bankruptcy and entered an agreement for a rival hardware chain to take it over. 7-Eleven is kicking off a companywide restructuring after refusing a buyout offer, and Walgreens said it plans to close 14% of US stores in response to falling demand.

In today’s edition:

—Andrew Adam Newman, Alex Vuocolo, Paige McGlauflin

MARKETING

Shrinking outside of the box

Side by side comparison of containers of yogurt, one smaller than the other, with the word "shrinkflation" spelled out below. Tanaonte/Getty Images

Shrinkflation—the tendency of brands to shrink products, often imperceptibly, without lowering the price—is something we first noted in 2022.

And while there have been many developments since—what with a French supermarket naming and shaming shrinkflated products with shelf signage, Germany drafting an anti-shrinkflation law, and President Biden releasing a video decrying the practice—we hadn’t encountered a comprehensive study of just how pervasive the practice was in the US.

Until now.

A LendingTree analysis of 98 supermarket products found that over the last four years, 30 of them (31%) had shrunk. Paper products (toilet paper and paper towels) were the most apt to shrink, with 12 of 20 (60%) shrinking since either 2019 or 2020. A 12-pack of Angel Soft mega rolls saw per-roll sheet count shrink from 429 to 320 sheets, a 25.4% decrease. While the cost of that 12-pack was lowered from $9.97 to $8.44 over the period, the study revealed that the price per 100 sheets increased from 19 cents to 22 cents, an increase of 13.5%.

Charmin Ultra Strong, meanwhile, shrinkflated and raised the price. A 24-pack of mega rolls saw each roll shrink from 286 to 242 sheets, a 15.4% decrease, while the cost rose from $23.82 to $26.48, a per-100 sheet increase of 31.4%.

Keep reading here.—AAN

   

Presented By Bandwidth

Slide into the DMs

Bandwidth

SUPPLY CHAIN

Watch the merchandise

3 retail store shelves with product on them depicting visual merchandising Amelia Kinsinger

If retail operations were as simple as dumping product on the sales floor, there would arguably be a lot less work for managers and store employees. The truth is—even for warehouse stores such as Costco or discount grocers such as Aldi—how products are arranged and promoted within the store is an essential part of the business. And generally this work falls under the label of merchandising, a term that encompasses everything from signage and in-store displays to product demonstrations and promotions.

  • Shopify defines merchandising as “everything you do to promote and sell your products once the potential customer is in your store.”
  • Indeed offers a similar definition and adds “this can include all promotion and marketing activities from the initial planning stage to the execution stage.”

Here are some concrete ways retailers are overhauling their merchandising practices as they try to appeal to a customer base that is increasingly cautious and discerning.

Keep reading here.—AV

   

HR

Upskilling and able

A Walmart employee working in one of the retailer's stores. Houston Chronicle/Hearst Newspapers Via Getty Images/Getty Images

A storm is coming. As experienced professionals in fields including manufacturing and transportation retire, many occupations will become increasingly difficult to recruit for, worsening the existing skills shortage.

Walmart, the world’s largest company by revenue, is turning to its 2.1 million global employees to fill the gaps.

When the company realized it would need to fill 100,000 “higher-paying and in-demand” roles within the next three years, it decided to focus on developing its existing employees. Lo Stomski, Walmart’s chief talent officer, is leading the team focused on making this talent strategy possible at Walmart.

Keep reading here on HR Brew.—PM

   

From The Crew

The Crew

SWAPPING SKUS

Today’s top retail reads.

Off the calendar: Why retailers are tossing out their usual holiday sales calendars with earlier and earlier promotions. (the Associated Press)

Halloween crunch: Halloween spending is expected to come in lower this year, which is bad news for some troubled companies such as Michaels and At Home. (Bloomberg)

Extra butter: Higher butter costs are set to raise the cost of doing business for European bakers during this year’s holidays. (Reuters)

BFCM boost: Busy season is coming—it’s time to ace the SMS game. To help you crush it, Bandwidth put together a Black Friday SMS Handbook full of helpful deets. Read it.*

*A message from our sponsor.

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