Economics: What is Skimpflation and why is it needed?

Note: The following article was written by Romiru Thantirimudali U6

Something almost every grocery shopper in the last 5 years may have picked up on is constant changes in consumer goods; whether it's a bottle of shampoo or a tub of greek yoghurt. For the most part, these changes haven’t been positive - aside from the obvious effects of inflation, the product itself has been renowned to vary in size, quality and overall consumer satisfaction. 

This process is called ‘skimpflation’ - a surprisingly under the radar term for a problem that is becoming increasingly evident and rather annoying for anyone doing their weekly shopping. Broadly, skimpflation is a prominent consumer-facing issue that can manifest in labour changes, like fewer workers to assist in stores; downgrading the quality of offerings, like eliminating service tiers; or swapping out high-quality ingredients for lower quality ones, such as within manufacturing.

There is evidence for ‘skimpflation’ almost everyday. A growing trend of supermarkets selling a cheaper, less nutritious alternative to tinned mackerel is an example of "skimpflation", a consumer group has said. Princes - which supplies major supermarkets - has substituted jack mackerel, an entirely different species, for mackerel, with similar tins also being sold by Lidl.

The switch has been spurred by diminishing stocks of Atlantic mackerel after years of overfishing, with its Chilean counterpart more sustainable and a third of the cost. This switch isn't exactly a good thing for mackerel lovers - aside from a difference in taste, Jack mackerel contains about half as much omega-3 and around a third as much vitamin B12 as traditional mackerel. 

As of now, in a skimpflation economy, the responsibility is upon consumers to get the best value out of their goods, being resourceful and knowledgeable. Both Balagtas and Wolla recommend comparison shopping to detect where companies have pulled back. However, not all hope is lost for better quality and service - competition, especially in more saturated markets, where a demand for high quality exists, means some companies may stick to their guns and continue to produce at a higher level of consumer satisfaction, even if it may not give them an immediate financial advantage.