Ethical Dilemma – Potato Chip Packaging

The Incredible Shrinking Potato Chip Package

A regional potato chip company, Salty Snacks, is competing with large, national snack food companies. Salty Snacks faces a dilemma about pricing vs. quantity. A drought caused a minimized potato crop compared to the previous year, which will cause the 7.5 oz package of chips to increase in price from $1.59 to $1.83. The company is concerned that customers will not be receptive to the price increase, and will switch to the national brands, who can afford to maintain the lesser price. Historically, other companies facing the same problem maintained the pricing and the packaging size, and reduced the volume (net weight) of product instead. Known as “downsizing”, this strategy appears to go unnoticed by customers. There are no FDA regulations restricting downsizing, and companies are required to disclose net weight, serving size, price, and quantity on the package. The manager of the company is struggling with the decision to downsize their product, because she views it as a deceptive practice.

Ethical Questions:

1. Should Salty Snacks advertise/notify their consumers that they have reduced their product’s net weight?

2. Based on Environmental practices, would it be more ethical if Salty Snacks were to also reduce packaging size along with net weight? Thus, reducing environmental impact?

3. Based on Socially Responsible practices, can reducing the amount of chips sold be looked upon as aiding the fight against obesity?

*Story is modified from original source:  http://wpweb2.tepper.cmu.edu/ethics/AA/mktg04-case.pdf

Advertisements

14 Responses to Ethical Dilemma – Potato Chip Packaging

  1. Many companies are reducing packaging sizes due to increased packaging and material costs. This has happened with regularity over the years to many products. It’s just more evident now that grocery prices are rising rapidly.

    Companies feel that keeping the price the same is more important than telling the consumer about less product. In many cases the unsuspecting consumer never notices the differnece. There have been a series of articles written about “package shrink.”

    If I were a smart marketer I’d offer more value for the same size not less.

  2. I have been noticing reduced packaging at the same price over the past year. I find it especially noticeable with cereal.

    Cereal is overpriced as it is and to spend the same amount of money for less when I feed a family of 10 is unjustifiable in my eyes.

    I would rather spend a few cents more for the same amount than to get less for my money.

    The other thing that just kills me is when you open a bag of chips, the ratio of chips vs air…there’s got to be a better way to package them!

  3. Felice says:

    Salty Snacks has an opportunity to educate and involve its customers by explaining the reason for the price increase and promising to inform customers every time market conditions require the company to change price or volume, up or down.

    If the company has a large supply of packaging on hand, it should keep the same packaging. If the company anticipates that this year’s bad crop is an aberration, again, using the same packaging would be more efficient over time. No new design would be required nor would the package template need to be retooled.

    The company could save time and money by not developing advertising to educate and inform customers. Customers could be notified by a label affixed to the chip package.

  4. I would like to thank you for the efforts you’ve put in writing this web site. I am hoping the same high-grade site post from you in the upcoming also. Actually your creative writing skills has encouraged me to get my own web site now. Actually the blogging is spreading its wings quickly. Your write up is a great example of it.

  5. I am now not positive where you are getting your information,
    but good topic. I needs to spend a while finding out much more or understanding more.
    Thanks for magnificent information I used to be in search
    of this info for my mission.

  6. Mesin Kasir says:

    What’s up colleagues, how is all, and what you would like to say concerning this piece of writing, in my view its
    actually awesome designed for me.

  7. Everything is very open with a really clear explanation of the challenges.
    It was truly informative. Your site is useful. Thanks for
    sharing!

  8. Homer says:

    What’s up it’s me, I am also visiting this website daily,
    this web page is really nice and the visitors are in fact sharing good thoughts.

  9. Great blog right here! Additionally your website so
    much up very fast! What host are you the usage of?
    Can I am getting your affiliate link to your host?
    I desire my site loaded up as quickly as yours lol

  10. WOW just what I was searching for. Came here by searching
    for pusat spiritual

  11. I am in fact happy to glance at this webpage posts which
    includes lots of useful information, thanks for providing such statistics.

  12. I was recommended this blog by means of my cousin. I
    am not certain whether or not this submit is written through him
    as nobody else know such particular approximately my difficulty.
    You are incredible! Thanks!

  13. Pretty element of content. I just stumbled upon your website
    and in accession capital to claim that I acquire in fact loved account
    your blog posts. Any way I will be subscribing on your feeds
    and even I success you get entry to persistently rapidly.

  14. I keep listening to the rumor lecture about receiving free online grant applications so I have been looking around for the most excellent site to get one. Could you tell me please, where could i find some?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: