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Kellogg shrinks boxes of several cereal brands
You'll pay same price for smaller packages of Apple Jacks, Cocoa Krispies, others

Associated Press
Published on: 06/17/08

GRAND RAPIDS, Mich. — It's a little less cereal for the same amount of money.

Kellogg Co. is using smaller packaging while charging the same prices for five of its cereals sold in the United States, effectively raising their prices for the second time this year. The company started shipping the new boxes to stores in early June.

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Boxes were reduced by an average of 2.4 ounces for 14 items sold under the Apple Jacks, Cocoa Krispies, Corn Pops, Froot Loops and Honey Smacks brands, said Kellogg spokeswoman Susanne Norwitz.

"This price adjustment on select ready-to-eat cereal brands was taken to offset rising commodity costs for ingredients and energy used to manufacture and distribute these products," Norwitz said.

Kellogg increased prices in January in the low single-digit range, on a percentage basis, to offset higher costs, the Battle Creek Enquirer reported Tuesday. Its first-quarter profit still fell 2 percent when compared with the first three months of 2007.

The net result of the smaller boxes is a similar price increase, Norwitz said.

She declined to say whether the Battle Creek-based company will shrink the boxes of other cereals.

"We did an extensive analysis of all of our brands to determine what made the most sense for our business," Norwitz said.

Kellogg shares fell 82 cents, to $50.67 on Tuesday.

About a year ago, rival General Mills Inc., maker of Cheerios and Wheaties cereals, started selling its cereals in smaller boxes, at similar prices.

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Comments

By Kristian Bjornard

Jan 15, 2009 10:08 AM | Link to this

You know we have the cheapest food in the entire world right? We as americans pay the least per calorie of any nationality on the earth. Stuff costs money to make. Thus as inflation makes money worth less, and more and more people want to buy the same stuff, the cost of goods goes up. Economics 101. Instead of complaining that a business wants to make money, why don't you look at why you are buying apple jacks and cocoa puffs in the first place.

And by the way, you know what happens when wal-mart demands every-lowering costs? All manufacturing moves overseas, quality takes a nose-dive, and every other company goes out of businessı sounds real great. Besides the fact that it is sort of against sustainable laws of economics and physics.

Not that I don't still feel cheated. Raising the price, rather than shrinking portions, seems more honest, though is exactly the same.

By Fed up with big companies

Jan 13, 2009 6:55 PM | Link to this

I would pay more if the sizes were left as they were. A half gallon of ice cream is now a quart and a half. That is ridiculous. When I was a boy, a Baby Ruth candy bar that was a quarter of a pound was just 15 cents. These companies don't mind paying multi-million dollar salaries to sports players. The companies should be boycotted!

By Darlene

Jun 19, 2008 9:00 PM | Link to this

Yes, it's NOT just cereal that's down-sizing the amount but keeping the price the same. my husband and I have noticed several items like that at the grocery store, especially the Ice Cream. I hate being scammed, so we try not to buy those items -- like a boycott, in hopes the manaufacturers will change their practice for the better to continue to promote value and good customer relations. Only time will tell. There are a LOT of greedy companies out there. I REALLY feel sorry for the young ones growing up in today's economy.

By Tim Cogdill

Jun 18, 2008 11:34 AM | Link to this

I no longer buy any product that get shrunk - it is difficult at time - but it makes me so mad that they think I am that dumb - if you all did the same (and sent a letter to that effect) it would make a difference.

We hold the purse - they can't give anything to us we don't buy!!!!

Tim Cogdill / Wyoming

By Donald

Jun 18, 2008 11:03 AM | Link to this

Lest we forget about the liquid detergent industry. They cut their bottle size in half and kept their prices the same. They did this by simple calling it double (2X) strength.

Having to buy it out of need, I brought the bottle home and compared it with one of my existing bottles. There is no way, other than their word, to determine how this product was doubled in strength. Someone blamed the oil companies but I blame the federal departments responsible for oversight. Truth in advertisement, remember that? In this case the Federal Trade commission and we know about the lack of oversight from this dept as well as the FDA,FHA,Justice Dept,FEMA, and the entire Bush administration. So now we have high priced food, gas, medicine, insurance rates, pharmaceuitally polluted waters and on and on.

By Bill Beahan

Jun 18, 2008 10:51 AM | Link to this

Gore's stupidity and hypocrisy strikes again!

By Bill Beahan

Jun 18, 2008 10:51 AM | Link to this

Gore's stupidity and hypocrisy strikes again!

By Bill Beahan

Jun 18, 2008 10:51 AM | Link to this

Gore's stupidity and hypocrisy strikes again!

By Andy

Jun 18, 2008 10:15 AM | Link to this

Well, that is very interesting about Walmart. I can see it working there, but when Publix tries to sell breyers ice cream for $5.29 for 1.5 quarts that is a joke. 1.5 quarts for $3.00 at Walmart is more reasonable.
I don't know that I have any problems with Walmart pressuring venders. Dealing with Walmart is a little bit of gambling. You get a huge presence but at a very low margin among other risks. There is still horrible service, long checkout lines there, and low variety.

By mama mia

Jun 18, 2008 9:47 AM | Link to this

When this started, I decided to try some of the store brand cereals.My kids actually like most of them. They ususally have twice as much cereal too!

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