Groceries, retailers, and sari-sari stores sell shampoos cheaper by sachets than by bottles. The trend of the prices is as packs go smaller, so does the price per quantity of the products. The cost some brands of shampoos are sold to retailers goes against the conventional “cheaper by the bulk.”
In four leading supermarkets in the Philippines, shampoos like Pantene and Head and Shoulders have an average of 7 cents per ml difference between their big bottles and their sachets. One of the retailers sells a 6pc bundle of 10ml Pantene shampoo sachets at P84.63 while selling its 670ml bottle at P372.90. The difference is 12 cents per ml which makes the 670ml bottle P80.40 higher than 67 pieces of sachets. Another supermarket, 6pcs of sachets of 10 ml Head and Shoulders shampoo are sold at P27.75 while its 675ml bottle is sold at P354.75. Their cost per ml has a difference of 7 cents or a P44.25 price difference between the biggest bottle and the sachets.
The prices of commodities are based on the laws of supply and demand. The interplay of the supply and demand curves on a plane of price and quantity determines the price ceiling and the price floor as shown by Alfred Marshall’s model. The same law is used by the Department of Trade and Industry (DTI) in determining Standard Retail Prices.
Manufacturers also use this law to determine how much they will sell their product to retailers based on the production, packaging, and logistical costs. The quantity of sales also affects the price as selling in large quantities decrease packaging and logistical costs making the smallest quantities more expensive cumulatively.
The word sachet is a French term for a small bag. It commonly contains single-use food and other consumer goods. The first shampoo packed in sachets was in India. The Velvette shampoo in sachets was launched by Cavinkare, in early 1980’s. The idea was to pack Fast Moving Consumer Goods and make them more affordable to the masses. Its introduction revolutionized the market and sachets became popular in countries like India, Philippines, and other Eastern countries.
In all consumer studies, majority of the sales of manufacturers in the Philippines are derived from sachets. Much like Cavinkare, local companies studied the local population and the prevalent social classes then adopted the production of sachets to make their products more affordable; a strategy that proved successful in a country with a steadily rising poverty rate in the past few years. Today, almost all products are available in sachets such as condiments, meals, cigarettes, beverages, and more.
In 2004, a multinational fast-moving consumer goods manufacturer conducted a study examining the impact of sachets on the environment. It sampled 15 tons of garbage collected from wet markets, residential, and commercial areas in Manila. 10% of the total plastics found in the sample, or 1500 kilos, were composed of sachets of soaps, shampoos, and detergents.
Manila generates an average of 3 million tons of trash each year.
Sachets are classified as flexibles, laminates, or composite materials which have several layers of mostly non-biodegradable plastic. It is recyclable but households, garbage collectors, and scavengers show no interest in sorting and collecting used sachets due to lack of incentives which is why majority of used sachets still end up in landfills.