Birthday sponge cakes sold at Woolworths and lamb chops prepared at Coles were among thousands of products found to be weighing less than what was promised on packaging, according to the National Measurement Institute.
In 2014-15, Australia's peak weights and measures body issued 3962 non-compliance notices to traders, up 13 per cent on the previous year's figure. It sent 139 warning letters and imposed 98 fines totalling $92,650.
Nearly half of the breaches related to underweight or incorrectly labelled packaged products.
For the first time, traders were prosecuted under the National Measurement Act, resulting in four convictions, with two against the supermarket giants.
Woolworths was found guilty and fined $3000 for selling birthday mock cream sponge cakes, made and packed in-store, with shortfalls of up to 41 per cent.
A spokesman said it was an isolated event that came down to human error at its Maroochydore store in Queensland.
"We implemented refresher training to ensure high standards are maintained when supplying great value and quality products to our customers," he said.
Coles was found guilty and hit with a $3000 fine for using a weighing instrument not at zero that led to shortfalls of up to 9.4 per cent in prepacked lamb chops.
But a spokesman said the case involved one product in one store.
"The issue, which resulted from a piece of fresh meat sticking to an automatic cutting and weighing machine between slices, was quickly corrected and no wrongly labelled items were sold to customers," he said.
"Coles takes its trade measurement responsibilities very seriously and has robust operational and compliance systems in place in every one of its stores right around Australia."
The other two guilty verdicts fell on Santoshi International, for selling prepacked spices of only half the declared weight, and Musher Saleh of Lakemba Jewellery, for using an unverified measuring instrument.
The institute said prosecutions took place when traders continued to breach the law despite being issued warning letters, infringement notices and fines.
Overall, 7 per cent of 29,000 lines of packaged goods (amounting to 120,000 separate items) were found to be weighing less than what was declared on the label.
Seafood was the worst-performing category, with 18 per cent of seafood products found to be of incorrect weight. It was followed by dairy and meat.
A third of the complaints to the institute about prepacked articles were found to be justified, along with 40 per cent related to meat and 14 per cent related to fruit and vegetables.
Consumer advocate Christopher Zinn said while human errors and mistakes can happen, small shortfalls per packet added up.
"You can't tell at the shops if something is 5 per cent underweight. While that might seem like a trivial amount, that makes no difference to the producer producing a million pounds of something – it might make a very significant difference in terms of their bottom line," he said.
"You might gain some, lose some and it'll average out, but it shouldn't be above our technology and regulation to make sure that things are spot on as they can be."