Winnipeg Free Press - PRINT EDITION
Posted: 05/7/2014 1:00 AM | Comments: 0
It's going to cost you more to bring home the bacon.
In the face of soaring hog prices, one of the country's biggest bacon producers -- Maple Leaf Foods -- has reduced the weight of a standard package of bacon from 500 grams (one pound) to 375 grams. That means about four fewer slices per pack, for anyone who's counting. And those two packages cost the same.
It's a similar story with a standard package of wieners, said Munther Zeid, whose family owns five Food Fare grocery stores in the city. That's down from 450 grams to 375 grams, or from 12 wieners to 10.
Zeid said most of the other popular brands of bacon, including Olympic, Schneider's and Mitchell, are also going the same route because they're all owned by Maple Leaf. Because Maple Leaf also makes a lot of the private-brand bacon for supermarket chains such as Sobeys, they'll also likely be following suit, Zeid predicted.
"It's right across the board."
Zeid and officials with another local independent grocer in the city -- Cantor's Grocery Co. -- said it's also unlikely processors will go back to the bigger packages even if pork prices eventually come back down.
"Maybe if pork prices go back down to rock bottom, they might raise it back up to 500 grams, but I can't see that happening," he said.
Cantor's owner Ed Cantor and Gilbert Kohlman, manager of the store's meat department, also predicted the smaller packages will become the new norm when it comes to bacon and wieners.
"I don't think they'll ever go back to 500-gram packages," Kohlman said.
"Why would they go back?" Cantor added. "They would have to buy brand-new packaging again, and that costs a lot of money."
Maple Leaf president and CEO Michael McCain warned last week Canadian shoppers would be facing another hike in some meat prices this month in the wake of the porcine epidemic diarrhea virus (PEDv) wiping out millions of piglets in the United States and driving up hog prices. He said Maple Leaf saw its hog costs soar by 60 per cent in the first quarter of this year and has to move quickly to improve its margins.
But in the case of a standard package of bacon and wieners, the company opted to reduce the size of its products rather than raise prices.
"By slightly reducing the amount of bacon in a package, we can keep bacon prices at reasonable levels for consumers and help protect their pocketbooks," company spokesman David Bauer said in an email Tuesday.
Bauer said an aging population and smaller households are also influencing the way consumers eat staple items such as bacon.
"Seventy-five per cent of consumers do not eat an entire package of 500 grams (of) bacon. It is simply too much for them. By downsizing to 375 grams, we are better aligning our product proposition with the needs of consumers and ensuring their dollars go further."
Kevin Grier, a senior market analyst with the George Morris Centre, a Guelph-based independent economic-research institute, said he's not sure why the media is making a big deal of processors reducing the size of their packages of bacon.
"Everyone's costs are going up," he said, and processors have little choice but to either pass along those added costs or reduce the size of their products.
"It (product downsizing) is an age-old practice," he said. "What they're probably trying to do is make it more palatable (for consumers)."
Zeid agreed product downsizing is nothing new.
"It's been happening with detergents, paper towels, bathroom tissue, ice cream -- there isn't anything out there that hasn't been downsized (in recent years)," he said, noting chocolate bars and potato chips can also be added to the list.
The only thing that's new is that up until now, there were some products, such as a pound of bacon, that seemed immune to that trend, he added.
"It was always a pound of bacon."
So how are consumers reacting to paying the same price for less bacon and fewer wieners? Zeid and Cantor said so far, none of their customers has complained.
They also said processors have designed the new packages so they aren't noticeably smaller than the old ones.
"The majority of customers do not realize it's happened," Zeid said, adding in the case of wieners, they probably won't notice until they buy a standard package of wieners and a standard package of buns and realize they've got 12 buns and only 10 wieners.
But even then, they may not complain too loudly, he added, saying having two fewer wieners is probably easier to swallow than another price increase.
Republished from the Winnipeg Free Press print edition May 7, 2014 0
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