The French government announced a new rule requiring stores to inform customers when products shrink in size but maintain the same price, known as shrinkflation, starting from July 1. Finance Minister Bruno Le Maire described shrinkflation as a scam and emphasized the importance of transparency. Retailers must display price per unit and quantity changes next to affected products for two months. The rule aims to protect consumers, with the option to report discrepancies through SignalConso. Shrinkflation has been a concern amid rising prices and reduced purchasing power in France.
In economics, shrinkflation, also known as package downsizing or weight-out, is the process of items shrinking in size or quantity while the prices remain the same. The word is a portmanteau of the words shrink and inflation. Skimpflation involves a reformulation or other reduction in quality.Shrinkflation allows manufacturers and retailers to increase their operating margin and profitability by reducing costs whilst maintaining sales volume, and is often used as an alternative to raising prices in line with inflation. Consumer protection groups are critical of the practice.
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