, Singapore
Photo from Joshua Tsu via Pixabay

Why 'shrinkflation' is dangerous for F&B operators 

Inflation is expected to remain high at 4.6% in Singapore.

F&B businesses in Singapore that have resorted to "shrinkflation" to sustain revenue amidst the persistently high inflation risk damaging their image and goodwill in the long term, according to an analyst.

GlobalData defines "shrinkflation" as the passing down of costs to consumers. 

"This involves reducing the portion sizes in each pack or plate without lowering the label or menu prices proportionally," Bobby Verghese, consumer analyst at GlobalData, said.

"As shrinkflation raises the unit price of products, consumers get less value for their money. However, the drop in quantity is never publicised and is rarely noticed by consumers as packaged food is hardly ever purchased by grammage or litres, unlike the case with unpackaged fresh produce. Shrinkflation, thereby, has a silent impact on household budgets, unlike price hikes,"  Verghese said.

Tim Hill, key account director at GlobalData Singapore, warned that if consumers sport shrinkflation, they may switch to other brands, labels, or operators or postpone their purchase.

"Recently, Singaporeans upset by the shrinking food portions served at various eateries posted their experience on social media, and the news went viral. Given how fast negative publicity travels through social media, it can damage a brand’s or label’s image and goodwill in the long term," Hill said.

GloablData's Q422 consumer survey showed that 85% of Singaporeans are already keeping to a strict household budget amidst the high food inflation.

Additionally, 90% of survey respondents said they would buy cheaper alternatives.

Follow the link for more news on

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!


UOB deploys AI tools to level up employees’ productivity
The bank with the largest consumer footprint in ASEAN leads the way in adopting Microsoft’s Copilot for more collaborative and productive banking.
Italy brings its strong suits to Singapore’s fintech expo
Italian trade executive says 9 firms at the Singapore Fintech Festival 2023 exemplify the diverse range of products and expertise Italy can bring to the table.
Trust Bank sets the bar for digital banking in Asia Pacific
The digital bank targets to be Singapore's fourth largest retail bank, CEO Dwaipayan Sadhu said.