Cadbury, the No.1 player in Australia's $2 billion chocolate market, plans to reduce the size of its big-selling family blocks of chocolate by about 10 per cent to save costs.

The company blames rising packaging and raw material costs and has chosen to shrink the weight of its most popular product rather than increase the $4.99 recommended retail price.

"Clearly any chocolate lover is going to be a bit disappointed.": Amanda Banfield, managing director of Australasia for Mondelez International, the parent company that owns Cadbury, says the company is expecting a consumer backlash.

Amanda Banfield, managing director of Australasia for Mondelez International, the parent company that owns Cadbury and other big-selling brands, including Vegemite, Kraft, Red Tulip and The Natural Confectionery Co range of sweets, said she expected a backlash.

"We have to kind of be real about that," she said.