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article imageChocolate bars shrinking to keep profits up

By Lynn Curwin     Dec 18, 2010 in Business
Optimists may look at it as a measure which will help keep weight down but some UK residents will be upset to see their favourite chocolate bars have been reduced in size.
Companies like Nestlé and Cadbury are making bars a bit smaller while raising prices in an effort to protect their profit margins as costs of ingredients increase and the VAT raises in January.
Poundland will be selling Toblerone bars which are one triangle shorter so that the price can remain at £1.
Dairy Milk will go down from its 140g size to 120g and pack sizes will be varied.
"We have taken the decision to increase prices because of economic factors such as ingredient costs," The Guardian quoted a Cadbury’s spokesman as saying.
Cadbury, which was taken over by Kraft early in 2010, recently approved price increases.
The company previously upset some chocoholics when they removed popular bars from Heroes tubs.
In 2007 Time Outs and Picnics were removed, and in 2008 Dreams and Crunchies were replaced with Bournvilles and toffee Eclairs.
Sky News reported that Cadbury said it regularly made changes, but spokeswoman Alex Harrison said cost was "definitely a factor" in deciding which selections were included.
Boxes of Maltesers, which are made by Mars, went down to 120g, from 140g, during the last year.
"Most people have no idea how much a Mars bar or a Twix weighs, but it's starting to get tricky,” The Guardian quoted Mintel analyst, David Jago as saying.
“At first companies were reducing pack sizes but keeping prices the same but now both things are happening at the same time and people are starting to notice."
In October The Grocer reported that Cadbury and Nestlé were increasing the recommended retail price by up to 7 per cent on some of their most popular lines including Dairy Milk, Wispa, Kit Kat, and Yorkie.
"My worry is that chocolate is becoming a luxury item rather than an affordable treat," The Grocer quoted one wholesaler as saying. "We are beginning to reach the point now where people consider small bars to be expensive and we are seeing sales through independents declining."
The price of Nestlé’s bars has gone up twice this year. Yorkies and Aeros have also gone up in price, although they were reduced in size last year.
"Occasionally we make small changes to the size of our products, driven by a number of factors, including anything from a product reformulation, to a change in packaging, through to increases in cost bases,” The Guardian quoted a spokesman as saying.
In 2009 the BBC reported on changes the Food Standards Agency wanted made to benefit health. These included reducing the size of chocolate bars and cutting down on the amount of saturated fat and added sugar in biscuits, cakes, pastries, chocolate confectionery and soft drinks.
Many people find the VAT increases confusing. It will apply to chocolate coated biscuits but not chocolate chip cookies, and gingerbread men with two chocolate eyes are safe from the increase but not so those with any extra chocolate decorations such as buttons.
A list of which foods are affected can be found on the HM Revenue & Customs website.
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