Government mandates to counteract growing 'shrinkflation'

Economy

Published: 13 Dec. 2023, 17:18 Updated: 13 Dec. 2023, 21:45

Government mandates to counteract growing 'shrinkflation'

Cheese are displayed at a supermarket in Seoul on Wednesday. Cheese was among the 19 products studied by Korea Consumer Agency that reduced the quantity or size of a product without price adjustments. [NEWS1]

The government will make it mandatory for businesses to notify customers of any reduction in product sizes amid rising complaints against “shrinkflation,” said the Ministry of Economy and Finance on Wednesday.

Shrinkflation is the practice of reducing the size or quantity of a product while maintaining its original price. The practice has grown rampant globally as businesses grapple with rapid inflation hitting production expenses, including raw material prices.

The Korea Consumer Agency found changes in quantity or size in 19 out of the 209 products studied over the past year through November. They included nuts, cheese and sausages, according to its press release on Wednesday.

Under the current law, shrinkflation practices are not illegal.

To prevent the practice, the government will require manufacturers and distributors of food and daily necessities to inform customers of any changes in contents, size or ingredients of the products they sell.

It will expand the types of products required to notify about unit prices and will also make it mandatory for online sellers to abide by the unit pricing system in a bid to make it easier for customers to compare prices.

“The government will do its best to quickly revise related regulations and will monitor the performance status to eradicate irregular price increases,” said Finance Minister Choo Kyung-ho in a statement.

“The act of selling while being misleading about the amount is being deceptive to consumers. Selling and distributing products in such a way that causes distrust should be eradicated,” Choo said in a press conference on Tuesday. But he added that corporations have the freedom to decide the amount of content and the price for the product as long as it does not create health concerns.

The Fair Trade Commission on Wednesday said it will designate any acts of changing the volume or ingredients of a product without prior notifications to be “unjust.”

The antitrust regulator said it will quickly inform consumers of any changes in the packet contents as shrinkflation is increasingly seen across Korea.

The Korea Consumer Agency will push to sign an agreement with major retailers to collect information on the changes in quantities of 10,000 daily necessities and establish a joint monitoring system, according to the finance ministry. The agency will also expand the number of products it monitors from the current 128 to 158.

BY JIN MIN-JI [jin.minji@joongang.co.kr]