Companies faced with higher cost for raw materials often find that a decision needs to be made. Continue production as-is and lose money if the price for the item isn't increased; keep on manufacturing but raise the price or alter the product itself to reduce the cost of making it.
For many manufacturers, reformulations have been the chosen path to meeting consumer demand while protecting profitability. Of course, when changes are noticed, as in the case of a smaller candy bar or fewer rolls in a pack of paper towels, there is bound to be grumbling. This is especially true at a time when consumers are watching prices rise at a much faster rate than their take-home pay.
"The incredible shrinking package is becoming a very popular thing to write in about and talk about," Meg Marco, senior editor with the Consumerist told ABC News. "A lot of loyal consumers of certain brands are going to the store and they're noticing, 'Hey, what I buy every week is somehow slightly different. It says new and improved, but really I have 2 ounces less.'"
Changing a product's size does not always add up to consumers paying the same or more while getting less, say manufacturers.
Kimberly-Clark, which has reduced sheet count and roll size in paper products such as its Scott Tissue, contends that the new formulation makes the product what ABC described as "softer and loftier."
Georgia Pacific, which reformulated its Brawny paper towels, said the new version has thicker and softer sheets that last longer than the previous generation, which had 22 more sheets to a package.
Discussion Questions: Do you think most consumers are understanding in the current environment when it comes to manufacturers downsizing and/or raising prices on established brand products? Is there a right or wrong way to go about handling the announcement of a product being reformulated in a smaller size? What role is there for a retailer to play in the current scenario where products are being altered to avoid heft increases in prices to consumers?