Singapore Leads the Charge Against Shrinkflation with New Pricing Rules

“In an effort to increase pricing transparency, Singapore has introduced a new regulation requiring supermarkets to display unit prices on grocery items, helping consumers compare costs more easily and avoid deceptive pricing strategies.

This initiative, spearheaded by the Competition and Consumer Commission of Singapore (CCCS) in partnership with the Consumers Association of Singapore (CASE), will be implemented across major supermarket chains, including NTUC FairPrice, Sheng Siong, Giant, Cold Storage, and Prime Supermarket. The goal is to prevent misleading price adjustments and ensure fair value for shoppers.

Understanding Shrinkflation and Its Impact
Shrinkflation occurs when manufacturers reduce product sizes while maintaining the same price, effectively increasing costs for consumers. Companies often use this tactic to manage rising expenses without visibly raising prices, making it harder for shoppers to detect the change.

In Singapore, reports indicate that some snack brands have discreetly reduced pack sizes from 180g to 150g without adjusting the price. Similar trends have been observed globally, affecting a range of products from confectionery to everyday household essentials.

How Singapore’s Transparency Initiative Works
To counter shrinkflation, the new policy mandates that supermarkets display unit pricing—highlighting the cost per litre, kilogram, or 100g—alongside retail prices. This approach allows consumers to compare products more effectively and discourages retailers from using pricing gimmicks.

Minister for Trade and Industry, Mr Gan Kim Yong, stated that this move aims to “enhance price transparency, enable consumers to make informed decisions, and discourage misleading pricing practices.”

The system will first be introduced in selected supermarkets, focusing on essential goods such as rice, cooking oil, meat, eggs, fruits, and vegetables. Consumer feedback will be gathered before a nationwide rollout.

The CCCS highlighted that standardised unit pricing benefits both consumers and businesses by fostering trust in the retail sector. A spokesperson noted that the policy aligns with Singapore’s broader efforts to promote fair competition and protect consumer rights.

A Model for Other Countries?
Shrinkflation is a widespread issue, not limited to Singapore. Nations such as Australia and the United Kingdom have already enacted unit pricing laws to curb deceptive pricing tactics.

A study from the Michigan Journal of Economics found that shrinkflation damages consumer trust and brand loyalty, as many shoppers feel misled upon realising they are paying more for less.

By enforcing unit pricing regulations, Singapore is positioning itself as a leader in Southeast Asia in tackling shrinkflation. Industry analysts are watching closely to see if neighbouring nations, including Malaysia and Indonesia, will adopt similar measures.

With its structured approach and collaboration between government agencies and retailers, Singapore’s pricing transparency strategy sets a strong example that could influence international retail policies, ultimately promoting fairer and more consumer-friendly markets.”