Shrinkflation Brews Trouble in the Specialty Coffee Industry

Shrinkflation Brews Trouble in the Specialty Coffee Industry

Tom Maegdlin4/18/23


As the global economy grapples with fluctuating inflation rates, the specialty coffee industry is also experiencing its own form of this phenomenon—shrinkflation. This term refers to the practice of reducing the quantity or quality of a product while maintaining or increasing its price, a sneaky way for companies to offset rising costs without raising eyebrows.

Shrinkflation in Specialty Coffee

In the specialty coffee industry, shrinkflation has taken various forms. One such example is the reduction of bag sizes from the traditional 16-ounce (1 pound) bags to 12-ounce bags, while keeping the price per bag the same. This effectively increases the price per ounce without customers immediately noticing.

Another manifestation of shrinkflation in the coffee industry is the subtle decrease in quality. As prices for high-quality, ethically sourced beans rise, some companies have opted to blend lower-grade beans into their products to maintain profit margins. This results in an overall decline in the quality of the coffee, yet the price remains the same or even increases.

Shrinkflation in the specialty coffee industry has wide-ranging consequences for both consumers and producers. For consumers, it can lead to dissatisfaction with the perceived value of the product, as they are receiving less coffee or a lower-quality product for the same price. This could ultimately lead to a decline in brand loyalty and a shift in consumer preferences.

For producers, shrinkflation can undermine their efforts to promote ethical and sustainable practices within the coffee industry. Many specialty coffee roasters work directly with farmers to ensure fair prices and environmentally responsible growing practices. However, as shrinkflation forces companies to cut corners, these relationships may suffer, and the benefits that specialty coffee has brought to farming communities could be jeopardized.

To mitigate the negative effects of shrinkflation, transparency is key. Specialty coffee companies should be open with their customers about the reasons behind any changes in their products. Communicating about supply chain challenges, rising production costs, or market forces can help maintain consumer trust.

Consumers can also play a role in combating shrinkflation by becoming more informed and discerning in their purchasing decisions. By prioritizing quality, ethical sourcing, and sustainability over the lowest possible price, they can support businesses that are genuinely committed to upholding the values of the specialty coffee industry.

As shrinkflation continues to percolate through the specialty coffee industry, both companies and consumers must work together to address its consequences. By embracing transparency, fostering open dialogue, and making informed choices, the specialty coffee community can continue to thrive and uphold the high standards that set it apart from the mainstream coffee market.

-Tom "Tommy Hansa" Maegdlin