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Unit Pricing and a Dirty Little Secret

Retail labels per 100 count vs. per eaFor veterans of frugal shopping, unit pricing should be second nature – an unconscious automatic calculation leading to the best prices available. (Wow, say that ten times fast… or just continue reading.) For the rest of us, it requires just a little bit of thinking and perhaps a calculator.  And there is a little secret out there is that is designed to foul your plans!


Unit Pricing
Not long ago, grocery retailers were required to post unit prices on their shelves to assist shoppers in understanding the true cost of the goods they were buying. This does help – if you pay attention. But bear with me – it’s good to know how important it is to do this manually.

For example, if you are faced with purchasing dishwashing detergent- and you are intent on buying Brand X.  We have 5 different packages of the Brand X in the store. Without doing the math, choose the best bargain.

  • 12 oz bottle at  $2.89
  • 24 oz bottle at   $5.27
  • 48 oz bottle at  $9.99
  • 2 pack of 10 oz bottles at $4.
  • 3 pack of 14 oz bottles at  $11.39 with a coupon in hand for $1.00 off the package.

(Answers at the end of this post……)

See the dilemma?

Sally reports, “Of course the 3 pack with the coupon is the bargain, its a coupon!”
Barbara retorts, “You fool! Obviously the biggest bottle is the cheapest! Don’t you know anything?”
Roger wails, “I ‘m so confused, just get the small one. See the price is lowest.”

This points out the value of a price book, but more importantly – the necessity to Do The Math!

Now it is a little bit easier when a retailer posts the per unit cost on the shelf, but this is not always the case. Sometimes the tags are missing, sometimes they are just not updated.  The retail world is a rapidly changing marketplace. It is good to know how to do this manually. Its really simple.

Just count up the units, and divide the total cost (after coupons if you have any) by the number of units to get the cost per unit.

This is especially important if you do warehouse shopping. That giant 2 box combo of Krispy Krunchy Sugar Bombs that looks like a bargain can cost you more per ounce than if you bought the individual snack size pack. If you don’t do the math, you just don’t know.

Now  – about that dirty little secret I promised to tell you…

Even when the unit price is clearly labeled on the shelf beneath the goods you are buying – the Unit Price is a large, readable number. The hidden “trick ” in use in some places is that the Unit used to measure goods can be different!

You can be reading unit prices  on items that have 3 different brands or vendors and are measured in ounces, per hundred, per dozen, per quart, or per liter – all in the same area. If all you look at is the price itself  you can be wasting cold cash.  I’ve been “suckered” this way before.  Be sure the units match up, and know your price per unit!

Now, the simple answers to the Dishwashing Detergent Dilemma….

  • $2.89 / 12 oz = .24 per ounce
  • $5.27 / 24 oz = .22 per ounce
  • $9.99 / 48 oz =.21. per ounce
  • $4 /20 oz* = .20  per ounce         [*10 oz bottle x 2]
  • $10.39 /42 ounces = .25  per ounce    [3 bottles at 14 oz = 42 ounces]

Our price per unit winner is surprisingly the 2 pack of the smallest bottle. #4 , and the most expensive is the 3 pack with the coupon!

Not by much, and certainly not worth the effort to calculate on-the-fly. It’s just an illustration of how close the race can be, and the value of being armed with the knowledge, a pricebook, and /or a calculator.

Special thanks to Ed over at http://softsolder.com/ for the use of his images under Creative Commons Licensing.

PS. Did you  notice that the Unit Price in the image was for 100 count, versus per “each”?

ABOUT AUTHOR / Andi

Andi is a Marketing Assistant at ACCC. He is passionate about supporting financial literacy efforts and helping to educate people on the Talking Cents blog!

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