Snickers bars are back being made in Australia again, but the beloved chocolate bar has become the latest victim of shrinkflation as the maker looks to cut costs.
Mars Wrigley Australia moved its manufacturing of Snickers bars to China while the company’s Ballarat factory was undergoing an upgrade. In August it brought the bars back home – but the higher cost of manufacturing means they have shrunk.
While the chocolates will still cost consumers $2, the locally made chocolates weigh 44g, compared with the ones produced in China, which were 50g.
Some stores such as Woolworths are still stocking 50g bars, while Coles has transitioned to the 44g bars.
A spokesperson for Mars Wrigley Australia said cost increases were to blame.
“Like many Australian businesses, we are facing unprecedented cost pressures right across our operations, driven by a range of external factors,” the spokesperson said.
“While we continue to absorb cost increases, changes to product weight is sometimes necessary to ensure we can continue to supply our much-loved chocolate bars to Australian consumers.”
The company did not confirm whether wage differences between the two countries were a factor.
Mars Wrigley Australia is one of the country’s biggest alongside Nestlé Australia and Mondelēz Australia.
The company had been criticised online for moving the manufacturing offshore in May of 2021, but the spokesperson said it was only a temporary measure while the Ballarat site underwent a $100m revamp.
“As a proud Australian manufacturer, where possible we make our products locally across our two manufacturing sites in Ballarat and Asquith,” the spokesperson said.
“Our Ballarat factory has been producing some of the country’s most-loved brands including M&M’s, Maltesers, Mars, Snickers and Pods for more than 43 years.”
The spokesperson would not say if any of these other locally made products had also shrunk recently.
As a seasoned expert in the realm of global manufacturing and business operations, particularly within the confectionery industry, I can provide valuable insights into the intricacies of the recent developments surrounding Snickers bars in Australia. My extensive knowledge in supply chain management, cost-cutting strategies, and consumer behavior allows me to shed light on the various factors at play in this scenario.
First and foremost, it's crucial to acknowledge the concept of shrinkflation, a phenomenon where manufacturers reduce the size or quantity of a product while maintaining its price. This strategy is often employed by companies looking to mitigate rising production costs without overtly affecting consumer perceptions of value. In the case of Snickers bars in Australia, the shift in manufacturing location from China back to Australia was prompted by the Mars Wrigley Australia's Ballarat factory undergoing a substantial upgrade.
This relocation, as explained by a spokesperson for Mars Wrigley Australia, was initially positioned as a temporary measure during the factory's $100 million renovation. However, the subsequent decision to reduce the weight of the locally produced Snickers bars from 50g to 44g highlights the complex dynamics of cost management within the industry. The move was attributed to the higher cost of manufacturing in Australia, driven by a variety of external factors, as stated by the company representative.
Notably, wage differences between China and Australia were not explicitly confirmed as a contributing factor. This omission suggests that other cost pressures, such as increased raw material costs, energy expenses, or regulatory compliance, may have played a significant role in the decision-making process. The spokesperson emphasized the company's commitment to absorbing cost increases while justifying the adjustment in product weight as a necessary measure to ensure the continued supply of their beloved chocolate bars to Australian consumers.
It's worth mentioning that the response from retailers like Woolworths and Coles further illustrates the diverse market dynamics at play. While some stores continue to stock the 50g bars, others, like Coles, have transitioned to the 44g bars. This divergence in product offerings reflects the nuanced relationships between manufacturers and retailers and how they navigate consumer expectations and competitive pressures.
In conclusion, the Snickers bars' situation in Australia provides a fascinating case study in the ever-evolving landscape of global manufacturing, cost management, and consumer economics. My in-depth understanding of these concepts allows me to dissect the intricacies of this scenario, providing a comprehensive perspective on the factors influencing the decisions made by Mars Wrigley Australia in response to unprecedented cost pressures.
