How shrinkflation hides the true cost of rising prices

Your morning routine might look the same – a cup of coffee, a squeeze of toothpaste, a quick breakfast – but what you’re getting for your money might quietly be shrinking. This is shrinkflation: when manufacturers reduce the size or quantity of products while keeping prices the same, or in some cases, even increasing them.

According to a new report by Which?, this trend is spreading across supermarket shelves in the UK. From instant coffee to chocolate bars and indigestion tablets, many household staples are becoming smaller while their price per unit climbs.

For example, a tube of Aquafresh toothpaste that once sold for £1.30 for 100ml now costs £2 for a smaller 75ml tube – a 105% rise per 100ml. Gaviscon, the popular indigestion liquid, has shrunk from 600ml to 500ml, yet the £14 price tag hasn’t budged. The cost per 100ml has effectively risen by 20%.

Even coffee, a kitchen staple for millions, isn’t immune. A 200g jar of Nescafé Original Instant Coffee has quietly become 190g, a 5% increase in price per 100g. Meanwhile, the size of chocolate multipacks has dropped too – KitKat bars went from 21 to 18 in a pack, while the price at Ocado rose from £3.60 to £5.50, a 53% increase.

It’s not just quantity that’s changing – quality, too, is being squeezed. Some brands have reformulated recipes to cut costs. White KitKats, for instance, now contain less than 20% cocoa butter and can no longer be marketed as white chocolate. Popular McVitie’s biscuits, like Penguins and Clubs, now include more palm oil and shea oil than cocoa.

Why it’s happening

Shrinkflation isn’t new, but it’s become more visible as global inflation persists. Manufacturers are facing higher costs for energy, ingredients like cocoa and dairy, packaging, and transport. Cocoa prices alone reached a 45-year high last year, while the broader cost of ingredients and energy has risen by nearly 40% since 2020, according to the Food and Drink Federation.

In this environment, companies have two choices: raise prices visibly or make subtle reductions in size or quality. Many opt for the latter, betting that consumers will notice less if their favourite product simply contains a little less. The result is a stealthy form of inflation – one that doesn’t always show up in the official data but has a real impact on household budgets.

A slow squeeze on household finances

For consumers, shrinkflation adds up to more than just smaller bars of chocolate. It’s another sign of how persistent inflation continues to erode purchasing power. Even as headline inflation figures ease, many families find their weekly shop costs more but lasts less time.

The issue isn’t just about perception – it’s about real value. If you’re paying the same price for less product, you’re effectively facing inflation at a higher rate than the national average. Over time, this steady erosion can make it harder for households to keep up with living costs, save effectively, or plan ahead.

What it means for long-term savers

The same principle that makes your coffee jar shrink applies to your savings – inflation gradually reduces what your money can buy.

At a 5% annual inflation rate, something that costs £1,000 today will cost £1,050 next year, and more than £2,650 in 20 years. That means that if your pension contributions or investments don’t keep pace, the real value of your savings could fall by half over two decades.

For long-term savers, particularly those building a pension, inflation is one of the most important (and often overlooked) risks. A saver contributing £100 a month today might feel they’re setting aside a solid amount – but in 20 years’ time, that same £100 could have the purchasing power of just £50 if inflation remains high.

That’s why staying invested, diversifying across asset classes, and reviewing contributions regularly are essential steps to help protect your future purchasing power.

Beyond the supermarket shelf

Shrinkflation might feel like a minor frustration at the checkout – a smaller pack of biscuits or one less chocolate bar in a box. But it’s a symptom of something much bigger: the quiet, steady pressure that inflation puts on our daily lives and long-term plans.

And while you can’t stop companies from resizing their products, you can take steps to ensure your money doesn’t “shrink” in the same way. Keeping an eye on inflation, investing for the potential of growth, and planning ahead can make a real difference – ensuring that your future wealth retains its real value, no matter how the prices on the shelf change.