Supermarket pricing under review

Since supermarkets introduced unit pricing in July 2009, shoppers have been able to save money on groceries by comparing different brands of the same product based on a standardised pricing according to weight, volume or unit.

However, the code that mandates what is known as unit pricing is under review ahead of its expiry date next year.

But a huge public response to the impending end of supermarket comparison pricing has forced the Government to extend the submissions deadline by more than two months.

Under the Retail Grocery Industry Code of Conduct, supermarkets and online grocers must display the unit price of household staples, together with the headline price.

Before the code lapses on 1 October 2019, the Government is assessing its effectiveness and calling for the public’s views.

When consultation began last month, consumers were encouraged to complete an online survey to give the Government instant feedback on the issue.

“The consultation … has already generated a high level of interest with a consumer survey on consumer experiences with grocery unit pricing receiving more than 500 responses in the first two weeks,” Assistant Treasurer Stuart Robert said in a statement.

“Previous consultations have identified interest in exploring a range of issues such as how unit prices are displayed and whether the obligation to display unit prices should be extended from large format grocery retailers to smaller grocery stores or more widely in the retail sector.

“I’m encouraged that consumers and business have been engaging on whether to remake the code, and whether it would benefit from any amendments. I encourage all stakeholders to contribute to this process.”

The Government has released a discussion paper on the Treasury website, where submissions can also be lodged.

The consultation period was due to close on 18 December, but submissions can now be provided until 28 February 2019.

According to the discussion paper, a 2012 review found that the code “had been effective and efficient in meeting its objectives over the post-implementation period; it was likely to do so into the future; and that it continued to remain an appropriate response to achieve the objective of supporting Australian households to save time and money, and increasing price competition in the grocery market”.

That review found that the total cost of implementing unit pricing was reported by the major retailers as being no more than $27 million and that ongoing compliance costs were low.

It also found “that households that actively use unit prices would only need to benefit by 32 cents per week, on an average weekly grocery bill of $176, for the benefits to outweigh its costs”.

“There is reasonable evidence to suggest that the code is assisting consumers in informing their purchasing choices.

“This paper seeks views on whether the regime is continuing to be effective and benefitting consumers and the potential for alternative consumer impacts if the code was not remade after it sunsets in October 2019.”

For more information about the current review and how to make a submission, contact Treasury’s consumer policy unit on (02) 6263 2111 or write to: [email protected].

Do you rely on unit pricing when you shop for groceries? Do you prefer to shop by brand or price? Has unit pricing helped you save money? Do you want unit pricing to continue?

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Written by Olga Galacho

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