Unilever refuses to rule out further shrinkage after cutting ice cream multipack sizes

Unilever chief executive Hein Schumacher said there was a need to offer smaller product packs to meet the needs of consumers experiencing financial difficulties. Photo: UNILEVER/FRIESLANDCAMPINA

The Unilever boss refused to rule out cutting down the size of its products after the company was criticized for cutting down Magnum ice cream and Simple soap bars.

Hein Schumacher, Unilever's chief executive, defended the use of so-called shrink inflation, in which in some cases supermarkets charge the same price for smaller products or multipacks of fewer items.

Mr Schumacher said: “About shrink inflation.” I want to offer two points of view. First, in some cases it is important to offer a basic package.

«This means that the smaller package is aimed at consumers who are truly more strapped for cash and who need a smaller size just to be able to put food on the table or provide themselves with essentials.

«This is what which we have historically done globally in many of our emerging markets. And when it's needed in developed markets, we'll obviously do it.”

In March last year, Unilever cut the number of ice creams sold in Magnums multipacks from four to three, but the price to customers remained the same.

Other examples include replacing 125g Pure soap bars sold under the Simple brand with 100g bars in May 2023, representing a 20% reduction in size, industry magazine The Grocer reported last year.

Former CEO Alan Jope previously suggested that cutting inflation might be a preferable alternative to raising prices.

Mr Schumacher added: “I'm not saying cutting inflation is a good idea. I said this could make sense for consumers at a time when they are feeling more cash-strapped. And when availability is an issue, smaller starter packs should generally be offered.”

In France, Unilever faced opposition from large supermarkets over the practice after retailers Carrefour and Intermarché placed posters in their stores , highlighting alleged acts of shrinkage, next to products from companies including Unilever.

Unilever published «disappointing» results, admitting it was struggling to gain market share as shoppers switched to supermarkets' own brands amid rising prices.

The London-listed company's turnover fell by 0.8% to 59.6 billion euros. (£51bn) and underlying operating profit rose 2.6% to €9.9bn.

“Private label shares rose in most categories as consumers sought value in a high inflation environment «, says the company's report. stock market update on Thursday.

Since taking over the company, Mr. Schumacher has been struggling to improve its performance by focusing on its best-selling brands.

He also did this. said the company would no longer seek to “forcefully align” its brands with social causes following investor backlash over so-called “virtue signaling.”

Unilever shares rose nearly 3% on Thursday.< /p >