October 13, 2015

Horse 2006 - Prices UP + Sizes DOWN

Contrary to nutritionists, dieticians, chefs and popular opinion, I think that there are in fact six and not five food groups.
Those six food groups are:
1. Breads and Cereals
2. Fruits & Vegetables
3. Meat and Meat Substitute (you're not fooling anyone, vegans)
4. Dairy,
5. Fats and Oils
6. Purple.
Group 6, the purple group contains all of those things that come in purple packaging. Ribena, Passiona and Milka chocolate come to mind but the most important item is Cadbury Dairy Milk. The other six groups are things that you need to survive but group purple are all things you need to make it worthwhile.
Something hideous has happened in group purple though; something so hideous and heinous that Cadbury should be reported to The Hague immediately for violation of human rights. That thing is... a block of Dairy Milk has shrunk from 220g to 200g.

Shock, horror, calamity, howls of pain, blood and thunder - declare a national emergency and broadcast the sirens and warnings for people to stay in their homes. This is worse than a nuclear error and a disaster of such magnitude that not even Batman can help us.

Okay, so its not exactly the end of the world and perhaps I am using a case of hyperbole by a factor of more than a million times but it is illustrative and deeply symbolic.

Cadbury used to trade on the slogan that there was a "glass and a half of full cream dairy milk in every 250g block". That might very well have been true but a 250g block shrunk to 220g and now 200g; which means that there's only four fifths of a glass and a half, which equals twelve tenths of a glass in every 200g block and whilst 12/10ths might sound funky and modern and groovy, it's still minus 50g of what we used to get and that's un-Australian.

This has also happened with the Mars Bar which used to be 70g, then 65g, then 60g and is now only 53g. A packet of Tim Tams used to have 13 biscuits before it fell down to 11 and then 9. A Subway foot-long sandwich (and the reason that I know this merely serves to prove that I am a tightwad, a curmudgeon and rather persnickety - which are all excellent qualities for an accountant to have), is now only 11 inches long.

This happens all across the supermarket as well.
For some hitherto unknowable reason, bread is now sold in 680g loaves and not 700g, cereal which used to come in 750g boxes now comes in 700g boxes and canned goods which almost universally came in 500g tins now only come in 440g tins; that's a nightmare when you're cooking and you now have to adjust all of you proportions to be 0.88 of what they were previously. As an accountant I live in a world of numbers but for the average person who forgot how to do long division once they left primary school, this may as well be as unfathomable as theoretical astrophysics.

I suspect two things going on here for the price of what is now less than one.
Firstly, to increase profits, companies can either up their prices which is bad or decrease the amount of stuff inside their packaging to achieve the same effect. Firms will prefer to do the latter because its easier to underestimate the intelligence of the general public because stupidity, ignorance and lack of awareness are three products that it is impossible to glut the market with. Far better to maintain prices and stiff the customer than to send a price signal and make them angry.

Secondly, the other thing which regularly happens in supermarkets is a highly well planned out confusopoly. In an average supermarket there might be as many as two thousand different individual items. By putting some things 'on special' even though people might be being held to an overall increase in their shopping budget of about 2% a year, because they literally can not hold information about all two thousand products in their head, they'll notice the seven items on special before they notice the overall increase in their overall bill. One item that's half price or 10% off, will easily offset the nine other things that had price increases.
What's really galling is if a 440g tin of four bean mix suddenly appears on the shelf as 14% extra free for a time. All that means is that they've saved some of the 500g tins from before, so that people think that they're getting a good deal, then when the 440g tin goes back on sale on the shelves no-one will notice the increase in price when it comes back.

One of the favourite questions that I hear in court a lot, when lawyers want to show that either their adversary or their adversary's client is out of touch with society, is to ask them what the price of a loaf of bread is. Admittedly this question isn't being asked as much at the moment because both Woolworths and Coles are undercutting local bakeries by selling 85c bread at a loss but when this unsustainable madness ends, the price that they'll put the price of a 680g loaf of bread will be more than the 700g loaf of bread which used to exist. Bread is also one of those things which can be differentiated (white, brown, mutli-grain, high fibre, low GI, rye) to the point where supermarkets can even run a confusopoly for this single product.

If that weren't bad enough, the Trans Pacific Partnership agreement (or "let's swindle all consumers in the Pacific at once" agreement) now means that governments have less ability to set quotas on imports, which means that beans from Chile, pineapple from America and tomatoes from Vietnam, can be dumped on any market in the region. Ostensibly this is being done in the name of lowering prices to consumers but everyone knows that multi-national companies will be pocketing the difference and that end-user consumer prices will not change significantly.
Now we can confidently ask 'what's that got to do with the price of fish in China?' and know that South Australian skipjack tuna farmers and fishers will be more than concerned; whilst at the same time a 500g of tuna became a 455g of tuna whilst nobody noticed.

People tend not to notice increases across multiple items and are only sort of aware of a general rise in their overall grocery bills. I also fall into that category but when it comes to me buying single items on a semi-regular basis at work, like a block of chocolate to go with a coffee break, I notice these things acutely. It's akin to having the flu and experiencing an overall malaise but then stepping on a bindi-eye that hitched a ride inside the house.
I'd even go so far as to say that I probably wouldn't be aware of price increases of single items if I didn't believe that Purple is a separate food group. It is isn't it?

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