How to calculate the real cost of groceries with a unit price

Fact checked

If you’re feeling the pinch of rising prices, especially at the supermarket, you’re not alone. A recent Canstar Blue survey found that 71% of Australian shoppers noticed the price of regular groceries had gone up. One way to stretch your budget further and lower your grocery bill is to look at the unit price – which tells you the REAL cost or value of a product. We cover everything you need to know about unit pricing below.

What is the unit price?

The unit price is a mandatory labeling system (under the Competition and Consumer Act 2010) which basically tells you the unit price of a product, or in other words, the cost per litre, per gram or kilogram (or whatever unit of measurement) of what you want to buy. It basically works like a standard unit of measurement that allows shoppers to easily compare product prices, regardless of size, brand or packaging. Unit prices for groceries are calculated to the nearest dollar and cent. You should be able to locate a product’s unit price on the shelf label if you’re shopping in a store or under the product image if you’re shopping online. Special catalogs will also display unit prices. This allows the prices of discounted products to be compared with the full priced items to determine if you are actually getting value for money or not.

Chips in the supermarket

How is the unit price displayed?

Here are the standard unit price measurements for various types of grocery items.

Items sold by Measurement of unit prices Examples of products
Weight Per 100 grams Rice, pasta, soups and spreads
Capacity/volume For 100 milliliters Vinaigrettes, sauces & cooking creams
Length By the meter Tape measure, wrapping paper
By number Per item included (each) Cleaning cloths, sponges and tongs

Some groceries are not subject to the same units of measurement – fruits, vegetables, meats and seafood which are usually sold by weight, are usually displayed with a unit price per kilogram or per item. Milk and other beverages such as cordials and soft drinks are measured by the litre.

How to compare grocery store prices with unit prices

As mentioned, Unit Price offers a true comparison of groceries, regardless of size, brand, or packaging. It’s also a good idea to check the unit price of products on sale to determine if you’re really getting a bargain or just smart supermarket marketing. Use the unit price to also compare pack sizes to determine which represents the best value.

Here’s how to use unit price to compare a product, in this case, eggs.

Coles Egg Unit Price

  • In this case, Coles’ larger carton of a dozen eggs may cost a dollar more to purchase, but offers better value with a unit price of $0.68 per 100g, compared to the smaller carton of six eggs which has a unit price of $1.03 per 100g.

Here’s how to use unit price to compare a product, in this case, milk.

Woolworths milk unit price

  • In this case, Woolworths Drought Relief 2L and 3L whole milks are on par in value with an equal unit price of $1.30 per litre.

Hot tip: Keep in mind that not everything you buy in bulk or on sale is always a bargain. The same goes for private label products. Sometimes fresh produce can be better value, while other times canned or frozen food can be less expensive. This is where unit pricing comes in handy as it provides a true “apples to apples” comparison of all products.

How to calculate the unit price yourself

If you cannot find the unit price of a particular product, you can easily calculate it yourself using this formula:

  • Laundry detergent A costs $7.50 for a 2.5 liter bottle − $7.50 ÷ 5 = unit price is $3 per liter
  • Laundry detergent B costs $6.20 for a 1.5 liter bottle − $6.20 ÷ 5 = unit price is $4.13 per litre.

The most economical product is therefore detergent A.

Do all supermarkets display unit prices?

Under Australian consumer law, supermarkets and large grocery stores are required to display the unit price on all food products and groceries. This applies to both physical stores and online purchases. However, all rules have exceptions and certain products are exempt from the unit price code, including magazines and stationery, flowers, toys, appliances, electronic gadgets, alcohol and cigarettes.

Coles Alley

Is the unit price displayed on sale items?

Yes, the unit price must also be displayed on sale items and promotional offers, including on 2-for-1 deals, and where two or more of the same groceries are offered for a single price; like two bottles of pop for $5 or four cans of tuna sold for $3.

However, a retailer is not required to display unit prices when:

  • different grocery items are sold together in a bundle (i.e. meal kits with different ingredients)
  • similar items of different sizes or weights are sold at one price (i.e. chocolates of different sizes sold for $2)
  • the item has been marked down because the packaging is damaged, or the product is nearing its expiration date or is no longer manufactured.

How to get a better deal with unit price

You can use unit pricing to get better value for money by comparing:

  • products of different brands
  • different sizes and types of packaging of the same brand and from one brand to another
  • packaged and bulk items (i.e. oranges, potatoes)
  • fresh, frozen, or canned foods (i.e. beans, corn)
  • similar products or substitutes (i.e. rice, pasta, cheese)
  • sale and full price items
  • various food retailers, including online stores.

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Maria D. Ervin