Inflation is creeping through to finished goods prices, just not always via a price increase. MSN Money’s Michael Brush:
Slammed by the skyrocketing costs of agricultural goods and energy, many companies are quietly shortchanging their customers by putting a little less into bags, jars and boxes.
“We are tightening our belts,” PepsiCo (PEP, news, msgs) chief Indra Nooyi said in a company conference call last week. PepsiCo recently reduced the amount of Tropicana orange juice you get in a large container by 7%, from 96 ounces to 89 ounces. Bags of Doritos, also made by PepsiCo, have been trimmed by as much as 2 ounces.
PepsiCo is not alone in subtly cutting size as a substitute for raising prices. Kellogg (K, news, msgs), General Mills (GIS, news, msgs), Unilever (UL, news, msgs), Wm. Wrigley Jr. (WWY, news, msgs) and Procter & Gamble (PG, news, msgs) have quietly trimmed the amount of cereal, ice cream, chewing gum, paper towels and toilet paper you get.
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