Can you crack cost-savings on raw materials without ruining the Easter egg experience?
The majority of us in the UK love chocolate: In the world league tables of per capita consumption, the UK comes joint 4th behind Switzerland, Germany and Austria. When it comes to Easter, approximately 80 million chocolate eggs are sold annually here in the UK, and Easter chocolate sales make up 10 per cent of our annual spending on chocolate.
Being the confectionary enthusiasts that we are, it’s no wonder that Britain is a bit aggravated to find out that the average weight of egg shells has fallen by 6.1 per cent – down from 185g to 174g in the last year, according to research by IRI UK.
Comments from the Grocer said that: “Brits should start saving early for Easter this year, as shrinkflation and changes to supermarket promotions threaten to hike the cost of the UK’s annual chocolate binge.” Shrinkflation is the term used to describe a situation where the prices remain the same as portion sizes get smaller.
Last year, we saw the iconic Toblerone reduce the weight of their product by taking out every other “pyramid” but keeping the cost the same. Other products, such as Terry’s Chocolate Orange, have shrunk by 10 per cent, We've also seen packaging prices rise, so striking the right balance between value for money and product protection can be a bit of a conundrum.
So what’s the cause behind getting less bang for your buck?
Choc on Choc co-founder Flo Broughton states that: “The price of raw cacao has risen significantly in recent months due to the growing number of people buying chocolate and an increased demand for quality product, coupled with a bad season and damaged supply.” Is supply slowing due to poor farming methods and in turn driving the planet towards a deficit where demand outstrips supply? Doug Hawkins, from London-based research firm Hardman Agribusiness, backs this up by inputting that: “production of cocoa is under strain as farming methods have not changed for hundreds of years.”
This, coupled with the falling pound means that foreign importers such as Mondelez, Nestle and others need to rethink market strategy. Where the UK is concerned, it could mean raising prices or cutting down product weight. Either way, it could affect the UK consumer and give us all less value for money on our favourite confectionary goods.
The falling pound not only contributes to food prices but also packaging prices. Historically packaging gets a lot of bad press around this time of year as weight of packaging versus weight of product is disproportionate compared to any other confectionery product range. The role of packaging is primarily to protect and with fragile product there is a high level of protection required. Let’s hope the 6.1 per cent reduction in egg weight is not taken from the thickness of the egg or we could see a substantially higher rate of spoilage this year unless packaging has been increased even further!