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> If the cost of wheat goes up, they shrink the size of the shredded wheat box. When the cost goes down, they may increase the size. More likely if the cost of
by benplumley 5y ago
> If the cost of wheat goes up, they shrink the size of the shredded wheat box. When the cost goes down, they may increase the size.
More likely if the cost of wheat goes up, they shrink the size of the box, and when the cost goes back down, they increase their profit margin.
- gruez 5y agoWhy not do it all the time to increase their profit margins?
- loa_in_ 5y agoAnd if done over long enough periods of time nobody significant might notice for years. Just smear the whole process over the span of a decade or multiple.
- throwaway984393 5y agoOnly if that configuration continues to be profitable. It may later become more profitable to increase the box size, or like they mentioned in the article, to standardize box sizes. The costs of cereals vary widely, which leads to fragmentation, which leads to logistical and operational inefficiency. They may even prefer to take a loss on this cereal to increase size if it affords them efficiencies across their whole product line.