It sounds ludicrous; the price of a jar of Vegemite in Maitland can vary by 33 per cent depending on which jar you buy?
Australia’s iconic brekkie spread is one of the items that can cost vastly differing amounts.
And, as inflation starts to tighten its grip on the nation and petrol prices and mortgage rate rises bite, the cost of groceries can make a significant difference to the average household budget.
That’s where the concept of unit pricing comes into play.
Unit pricing shows how much a product costs by proportion, for example, per 100g or litre.
At the moment unit pricing is used in Aldi stores across Australia, including East Maitland and Rutherford.
And unit pricing is a hot topic for consumers.
Family First Senator Steve Fielding introduced a Bill on unit pricing at the last sitting of Parliament.
And the Australian Competitor and Consumer Commission (ACCC) is talking to the major supermarket chains about it as part of their grocery prices inquiry.
“A Queensland Consumers’ Association survey of 25 supermarket items found that shoppers could save up to 47 per cent on a basket by using unit pricing to compare and buy the cheapest product,” Senator Fielding said.
“This will cut the grocery bill by $44 from $94 to $49.”
The Mercury did its own investigation into the price of staple grocery items at a selection of supermarkets across the city.
The results were startling.
The items surveyed did not support Senator Fielding’s claim but still found a cost disparity of almost a third, depending on which item you buy.
Out of the 10 items examined, the biggest difference was in the cost of dog food.
Forking out for food for your pooch can vary by 40 per cent a kilogram, depending on which bag of meaty bites you select.
The 1.25kg bag was $3.60 a kilogram but bought in the 8kg bag, it was $2.15 a kilogram.
Other price variations were toilet paper (34 per cent), cornflakes (27 per cent), and AA batteries (36 per cent).
Hope is on the horizon for shoppers who don’t want to calculate the differences on a busy round of the supermarket.
The big chains are about to jump on the unit pricing bandwagon.
In a major coup for shoppers, Coles told the ACCC inquiry into the cost of groceries on Monday that it will introduce unit pricing over the coming year.
“Our view is that unit pricing will benefit customers and we would prefer to see this adopted universally by all supermarket and food retailers across Australia,” Coles’ chief operating officer Mick McMahon said.
“Coles expects to be able to introduce full unit pricing over a year.”
“We would like to play on a level playing field and compete on the same basis.”
Implementation will cost about $10 million.
Coles’ main grocery rival, Woolworths, is also expected to roll out unit pricing throughout their Australian stores.
When Michael Luscombe, chief executive officer for Woolworths, was interviewed by the ACCC he said unit pricing was on the agenda.
When asked if Woolworths planned to implement unit pricing, Mr Luscombe responded, “Yes, we do. Yes, we do”.
“We anticipate the cost of doing it at about $4 million,” he said.
“If however, we have to do it in a very short period of time, it will be an additional cost.
“The only other thing I’d say is that if there’s some mandate on the size of the font and we have to change our shelf stripping, the capital cost alone of that will be some seven million dollars, six to seven million dollars plus the labour to actually change it all.
“So that would be something we wouldn’t like to see flow through to the price of food.”
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