Unit price comparison could save you hundreds of dollars at the supermarket

SEPTEMBER 10, 2014
News.com.au
YOU could be paying 14 times more for the same grocery product in the same store. Here’s how to ensure you never overpay again.
Australian shoppers are still largely ignoring grocery unit pricing, potentially putting themselves hundreds of dollars out of pocket every week, consumer advocates have warned.
Unit pricing is a mandatory labelling system introduced in 2009 intended to help consumers compare prices before they buy.
Retailers over a certain size must display standard units of measurement — unit prices appear as per litre, kilogram, 100 millilitres, 100 grams, 10 grams or per item, depending on the product.
For example, if a two-litre bottle of Coke is $4.40 at Coles, the retailer must also display its unit price of $2.20 per litre.
Ian Jarratt, a retired economist and spokesman for the Queensland Consumers’ Association (QCA), which has led the campaign for unit pricing in Australia, told news.com.au consumers were still largely unaware of how much money they could be saving.
“The supermarkets have done next to nothing to educate people,” he said. “It’s called the ‘confuse-opoly’ — the more you confuse consumers, the harder it is for them to make decisions and the easier it is for you to sell them a particular product.”
According to Mr Jarratt, common tricks of the ‘confuse-opoly’ include subtly reducing the product quantity without reducing package size, increasing package sizes without increasing the contents, or using unusual quantities — one manufacturer’s product might come in 100 grams, another in 115 grams, and another in 120 grams, for example.
“It’s all about the manufacturers and the supermarkets telling the consumer what they should be buying, rather than giving them the information they need to find the best value,” he said. “The last thing they want to do is compete on price.”
In order to demonstrate the benefits of comparing items by unit price, the QCA compared a range of items such as cornflakes, paracetamol tablets, cheddar cheese and white sugar.
In the most extreme example, the QCA found fresh chillies can cost $125 per kilogram when purchased in a 20-gram pack, but only $9 per kilogram when purchased loose — that’s nearly 14 times more expensive.
“People often ask why I’m on this crusade — I think about single mums who have three kids, who are really struggling to make ends meet. If they could save $20, $30, $50 per week on groceries, it would make a huge difference,” Mr Jarratt said.
“Consumers probably spend around $80 billion a year in supermarkets. So even small increases in the percentage of consumers who use unit pricing to make better decisions, or in how much they use it, can result in hundreds of millions of dollars in savings each year.”
In May this year, the QCA lodged a formal complaint with the Australian Competition and Consumer Commission (ACCC) after an investigation into Coles, Woolworths, ALDI, Costco and IGA stores found many not complying with unit pricing regulations. In response, the ACCC went on a public education campaign and updated its guidance to consumers.
Here are 10 tips from the QCA to help you make the most of unit pricing:
1. BRANDS
Compare the unit prices of different brands of the same product — between-brand differences are often large. But also look out for special offers which might temporarily have the lowest unit price.
2. PACK SIZES
Look at the unit price of other sizes of a brand and other brands. The unit price of large packs is usually much lower than small- or medium-sized packs. But watch out for exceptions and special offers, and avoid buying bigger packs if this will result in significant wastage.
3. SPECIAL OFFERS
Compare the unit prices of special offers with the regular price of the same product or with other brands and sizes. You may need to search on the label for the unit price of the special offer because often it is not very prominent or legible. It is worth making the comparison because there may be an identical or similar product or another pack size available at an even lower unit price.
4. LOOSE OR PREPACKED PRODUCTS
If a product is available loose or pre-packaged, check the unit price of both. Often the unit price of the loose product will be much lower than the packaged product, but there can be permanent and temporary exceptions. Products often available loose or prepacked include meat, fish, cheese, and fruit and vegetables.
5. ELABORATE PACKAGING
Compare the unit prices of products in elaborate packaging to those in simpler packaging. Generally, the simpler pack will have the lower unit price. Products often available in elaborate or simple packaging include dried herbs and spices, dried fruit, soft drinks, coffee, and processed fruit.
6. SUB-PACKS
If a product is available in sub-packs (for example individual portions/servings/sachets within a pack) as well as a just in one pack, compare the unit prices of each. The unit price for the product in sub-packs is usually much higher than for the alternative. Products often available in sub-packs or single packs include juices, soft drinks, yoghurt, dried fruit, and breakfast oats.
7. PRODUCTS IN DIFFERENT FORMS
Check the unit prices of the same product when it is sold in different forms, for example fresh and frozen. The frozen product may have a lower unit price or you may be able to freeze low-priced fresh product yourself. Products often available in different forms include chilled/frozen meat and fish, fresh/frozen/canned vegetables, fresh/frozen/canned fruit, and ground coffee or coffee beans.
8. SUBSTITUTE AND ALTERNATIVE PRODUCTS
Look for close substitutes for, and alternatives to, many products. Close substitutes and alternatives are available for many products. So, check out the unit prices of substitute and alternative products as well as those you normally buy. Products that often have close substitutes or alternatives include fruit and vegetables, meat, fish, and cheese.
9. PRODUCTS IN SEVERAL PARTS OF A STORE
If a product is sold in more than one part of the supermarket, check the unit prices wherever the product is sold. There can be big differences in unit prices between a product sold in different parts of a supermarket. Products often sold in several parts of a supermarket include, meat, fish, cheese, nuts, and fruit and vegetables.
10. UNIT PRICES AT DIFFERENT STORES
Compare the unit prices of products at different stores. Unit prices can vary greatly between stores so it pays to compare them and to be prepared to buy from one that offers better value. Unit prices have to be provided in printed advertisements and on internet selling sites so using these, and knowing the unit price you normally pay for an item, you can easily make between-store comparisons.