Application and key parts of the Unit Pricing Code

Minium range of food based grocery items

A grocery retailer sells the minimum range of food-based grocery items if it sells items from all of the following grocery categories:

  1. bread
  2. breakfast cereal
  3. butter
  4. eggs
  5. flour
  6. fresh fruit and vegetables
  7. fresh milk
  8. meat
  9. rice
  10. sugar
  11. packaged food, other than food mentioned in (a) to (j).

Exempt grocery items

A number of grocery items are exempt under the code and do not require unit pricing.

Exempt categories of grocery items

  • Books, magazines and stationery
  • Optical discs and magnetic storage devices used for computing, sound reproduction or video, whether or not they are pre-loaded with content
  • Photography items and equipment
  • Electrical items (other than batteries and light bulbs)
  • Garden tools, and items for garden or pool maintenance or decoration
  • Flowers, including fresh, dried and imitation flowers
  • Furniture
  • Hardware items
  • Manchester
  • Computer equipment
  • Audio-visual equipment
  • Telecommunications items or equipment
  • Items for motor vehicle maintenance or repair
  • Sports and camping equipment
  • Toys
  • Household appliances and kitchen and bathroom utensils
  • Clothing, jewellery and other fashion items (other than make-up)
  • Services, and goods supplied as part of providing a service, including mobile phone rechargers
  • Goods for hire
  • Cigarettes and other tobacco products, including nicotine replacement products
  • Alcoholic beverages
  • Haberdashery
  • Items sold from vending machines
  • Meals prepared at the retail premises for immediate consumption

Bundled grocery packs

Combinations of different grocery items that are sold together (or ‘bundled’) for a single price do not need to be unit priced. The items do not have to be packaged together for this exemption to apply.

Promotions where different items are offered at the same price

Unit pricing is not required for an offer where a range of different items are sold for a single price and the price remains constant.

Marked-down products

  • Perishables—items marked down from their usual price because they are getting close to their use-by date
  • Damaged goods—damaged items or items with damaged packaging that are marked down from their usual price
  • Discontinued items—items sold at a discount because they have been discontinued

However, items that are simply on special and bundles of the same grocery item are required to have a unit price displayed.

Units of measurement

Unit prices are based on the most appropriate unit of measurement, which is usually found on the grocery item's packaging.

Some items can be displayed in alternative units of measurement. However, generally speaking, unit pricing is based on the following standard units of measure:

  • volume (per 100 millilitres)
  • weight (per 100 grams)
  • length (per metre)
  • area (per square metre)
  • supplied by number of 40 or fewer items (per item)
  • supplied by number of 41 or more items (per 100 items).

If more than one unit of measurement is displayed on the grocery item’s packaging, the unit price can be based on the most common unit of measurement that the product is supplied in.

Display of unit prices

Grocery retailers must display unit prices for all non-exempt grocery items where selling prices are displayed on in-store labels, print advertising and websites. The unit price for a grocery item must be:

  • prominent—that is, it must stand out so that it is easily seen
  • in close proximity to the selling price for the grocery item
  • legible—it must not be difficult to read
  • unambiguous—the information must be accurate and its meaning must be clear.

The unit price must be displayed in dollars and whole cents.

Unit pricing for different items, bundles or multi-buys

As outlined above, unit pricing is exempt in situations where a bundle of different grocery items are offered and/or for promotions where different items are sold for a single price. We have released guidance to assist you in determining whether these situations apply.

Promotion of different items at the same price—clause 6(3) of the code

Under the Trade Practices (Industry Codes—Unit Pricing) Regulations 2009, a number of items are exempt from unit pricing. Clause 6(3) of the code states:

If a selling price is displayed in such a way that it applies to more than 1 grocery item, the prescribed grocery retailer is not required to display a unit price in relation to the selling price.

Difference between promotions of different items offered at a single price and bundles of different grocery items

We note the following observations:

  • Clause 6(3) provides that a unit price is not required to be displayed if a selling price is displayed in such a way that it applies to more than one grocery item.
  • In relation to clause 6(3), the explanatory statement (ES) to the code states:
Where a single selling price is displayed to refer to more than one grocery item, the code does not require grocery retailers to display a unit price in connection with that selling price. For example, a range of related grocery items (such as confectionery) may be sold at a single price, but each item may be a different weight or other measure.
  • The example provided in our publication Unit pricing: a guide for grocery retailers concerned the pricing for lipsticks of different weights that are all sold at a single price of $5.50 each (p. 14). In this scenario, the selling price of $5.50 is displayed in such a way that it applies to more than one grocery item—that is, different sized lipsticks. As these items are different weights, it would not be meaningful, practical or possible for a unit price to be displayed in relation to this single selling price.
  • Similarly, in the example cited in the ES, if a selling price is displayed in such a way that it applies to a 46 g Cadbury Picnic Bar, a 39 g Cadbury Twirl, a 50 g Cadbury Crunchie and a 30 g Cadbury Flake, the retailer is not required to display a unit price in relation to the selling price if it is displayed in such a way that it applies to more than one grocery item—in this scenario, different sized chocolate bars. The provision of a unit price in relation to a single selling price applicable to all these chocolate bars would not be meaningful, practical or possible.
  • The reference in the ES to 'a range of related grocery items' indicates that clause 6(3) is intended to apply to items that are different, although they may or may not belong to the same product category.
  • We consider that clauses 6(3) and 7(1)(b) provide different exemptions under the code and are intended to operate in different circumstances (although it is conceivable that both exemptions may apply to certain conduct).
  • In this regard, we note that clause 6(3) provides an exemption if a selling price is displayed in such a way that it applies to more than one grocery item. To fall within the exemption, a retailer must identify a selling price that applies to more than one grocery item.
  • In contrast, we note that clause 7(1)(b) provides that a unit price is not required for a grocery item that is a bundle of different grocery items offered for sale for a single price. To fall within this exemption, a retailer must identify a grocery item that is a bundle of different grocery itemsbeing offered for sale for a single price
  • In the example cited in the ES regarding clause 7(1)(b), if one bottle of lemonade is sold for $2.00, and the retailer offers a 'multi-buy' of five bottles of lemonade for $8.00, the price representation of five bottles for $8.00 requires a unit price to be displayed. This is because $8.00 for five bottles of lemonade does not constitute a 'bundle of different grocery items' and therefore the clause 7(1)(b) exemption does not apply. Further, the exemption provided for by clause 6(3) does not apply as $8.00 for five bottles of lemonade does not constitute a selling price which applies to 'more than 1 grocery item'. This is because the $8.00 does not apply to each bottle of lemonade, but to five bottles of lemonade.

Multi-buys: what constitutes 'different' grocery items?

Under clause 7(1)(b) of the code, unit pricing is exempt where a bundle of different grocery items is offered for sale for a single price':

Exempt grocery items
(1) A prescribed grocery retailer is not required to display a unit
price for a grocery item that:
 ….
(b) is a bundle of different grocery items offered for sale for a
single price

The code does not contain a definition of 'different grocery item' in relation to clause 7(1)(b).

Relating to clause 7(1)(b), the code's ES states:

A grocery item that is a bundle of different grocery items is exempt from the unit pricing requirements. An example of such a bundle is a soup kit consisting of carrots, potatoes, onions, split peas and stock. However, bundles of the same grocery item are still required to display a unit price. For example, if one bottle of lemonade is sold for $2.00, and the retailer offers a 'multi-buy' of five bottles of lemonade for $8.00, the price representation of five bottles for $8.00 requires display of a unit price. [ES, p. 5]

The intention of clause 7(1)(b) is to exclude unit pricing where a grocery item, being a bundle of different grocery items, is offered for sale for a single price and the grocery items that make up the bundle differ to such an extent that any unit pricing information is not meaningful or practical for consumers. This is consistent with the purpose of the code, which is to require the use of unit pricing by certain grocery retailers—that is, to assist consumers in comparing the price of grocery items.

Identical products or multi-buys

Accordingly, where a retailer offers a bundle of items (often referred to by industry as 'multi-buys') that are identical, a unit price must be displayed. Unit pricing in these circumstances is meaningful because the items are identical and a meaningful unit price is able to be derived from the selling price. It is also practical for retailers to provide unit pricing information in these circumstances because the items are identical—that is, the items are of the same type and size.

Similarly, the provision of unit pricing will also be both meaningful and practical where similar items—for example, items that are of the same volume, weight or area, often part of one particular product line but, for example, featuring different flavours—are offered together as a bundle.

In many cases, the particular characteristics of the items the subject of the 'multi-buy'—such as the type or nature of the product and its weight and/or volume—mean that the provision of unit pricing is both meaningful and practical.

In other cases, the particular characteristics of the items may differ to such an extent that the provision of unit pricing information is unlikely to be meaningful for consumers and unlikely to provide greater comparability between products. In these circumstances, it may also not be practical for retailers to provide unit pricing for items that may comprise a multi-buy.

As such, the issue of whether the exemption under clause (7)(1)(b) applies to a bundle of items will require a consideration of whether the items constituting the 'bundle' are 'different' for the purposes of the code.

It is our view that retailers can act consistently with the purpose of the code and avoid the risk of contravening its provisions by displaying unit pricing where it is practical, meaningful and possible to do so. Where products are part of the same product range, but may vary in ingredients, composition or flavour, it may still be meaningful, practical and possible to provide unit pricing information. For example:

  • An offer consisting of 'any two Cadbury's ice cream (2 L) for $6'—notwithstanding that the offer may involve different flavours (chocolate, vanilla, neapolitan) and ingredients, the product line and the size of the products are the same, and the offering can be meaningfully and practically unit priced.
  • An offer of 'any two Campbells Homestyle soups (440 g) for $4'—notwithstanding that each can of soup may contain different ingredients (e.g. Campbells Homestyle Chicken soup 440 g and Campbells Homestyle Pumpkin soup 440 g), the product line and the size of the products are the same, and the offering can be meaningfully and practically unit priced.
  • An offer of 'any two Coca Cola 2 L soft drink varieties for $4'—notwithstanding that each soft drink may contain different ingredients (e.g. 2 L Sprite, 2 L Coca Cola, 2 L Diet Coke, 2 L Fanta, 2 L Diet Fanta, 2 L Lift ), the product line and the size of the products are the same, and the offering can be meaningfully and practically unit priced.
  • An offer consisting of two or more products that are the same size and contain the same main ingredient but may vary in flavour and/or additives—for example, tuna with olives (200 g) and tuna with lemon pepper (200 g)—the offering can be meaningfully and practically unit priced.

What is considered 'different' for the purposes of clause 7(1)(b)?

In other cases, the particular characteristics of the products may differ to such an extent that the provision of unit pricing information is unlikely to be meaningful for consumers and unlikely to provide greater comparability between products. In these circumstances, it may also not be practical for retailers to provide unit pricing for items that may comprise a multi-buy.

Some examples of combinations of products we are likely to consider as 'different' for the purposes of clause 7(1) of the code include:

  • As per the example in the ES, a soup kit consisting of carrots, potatoes, onions, split peas and stock. Each product is clearly different in terms of composition/vegetable variety, and size. The display of a unit price is not meaningful, practical or possible.
  • An offer for a packet of 400 g Birdseye frozen fish fillets + a 200 g packet of Birdseye frozen chips. Each product is clearly different in terms of composition/ingredients, size and product line. The display of a unit price is not meaningful, practical or possible.
  • An offer for a bottle of 800 ml Dolmio Bolognese pasta sauce + a 200 g packet of San Remo pasta. Each product is clearly different in terms of composition/ingredients, size and product line. The display of a unit price is not meaningful, practical or possible.

Ultimately, the breadth of the exemption provided by clause 7(1) of the code will be a matter for determination by the court or legislative clarification.

Rounding and unit pricing

It is noted that when unit prices are multiplied, the result may not exactly match the advertised selling price due to the practice of rounding up/down of unit prices.

Under the code, unit prices are to be worked out to the nearest cent, with half cents rounded upwards, under clause 8(5).

For example, if you calculate the unit price for a can of soup at $0.515 per 100 g (without rounding), the unit price must be displayed as $0.52 per 100 g as illustrated on p. 17 of Unit pricing: guide for grocery retailers.

Alternative units of measurements

Clause 11 of the code requires some specifically listed items to be unit priced in accordance with the units of measurement prescribed by that clause. These are outlined in the ACCC's Unit pricing: a guide for grocery retailerson  pp. 9–11.

In particular, clause 11 provides that alternative units of measurement apply to 'Meat' and 'Fruit and vegetables (including mushrooms)'.  The applicable units of measurements are as follows:

  • Meat

(a) per item included; or

(b) if supplied by weight—per kilogram.

Note 1 at end of clause 11 states that 'the reference to meat includes any meat, regardless of whether it is fresh, frozen, dried, canned or otherwise pre‑packaged, and includes dressed poultry, seafood and small goods'.

  • Fruit and vegetables

(a) per item included; or

(b) if supplied by weight—per kilogram.

Note 2 at end of clause 11 states that 'the reference to fruit and vegetables (including mushrooms) includes any fruit, vegetable or mushroom, regardless of whether it is fresh, frozen, dried, canned or otherwise pre-packaged'.

Application of clause 11, notes 1 and 2 to fruit, vegetable or meat products

The code does not detail the extent or level of processing that occurs in order for a product to fall within, or fall outside, a particular grocery category such as a 'fruit', 'vegetable' or 'meat'.  

We consider that a fruit, vegetable or meat product that has been significantly altered from its raw or natural state to the extent that it is no longer ordinarily described by reference to such a category is unlikely to fall within the categories listed in clause 11.

The following examples illustrate the factors that may be considered when determining whether a product has been significantly altered:

  • If the only change to the product is that it has been sliced, diced or pureed, we consider that the product has not been significantly altered. We therefore consider that canned or diced tomatoes, for example, have not been significantly altered.
  • If the only alteration to the product is an additive or method to preserve the product, we consider that the product has not been significantly altered. For example we consider that products that are preserved in salt, sugar; or by methods such as smoking (i.e. fish), drying, freezing etc. have not been significantly altered.
  • If ingredients are added to or blended with the product to augment the product, such as by marinading, glazing or placing the product in a sauce, we consider that the product has not been significantly altered. We therefore consider that products such as marinated chicken wings, lamb kebabs in satay sauce for example, have not been significantly altered.

Below are further examples of how this principle may be applied:

Products likely to fall within clause 11

  • Frozen beefburgers fall under the ‘meat’ category
  • Dressed poultry, seafood and other smallgoods fall under the ‘meat’ category
  • Tins of flavoured tuna falls under the ‘meat’ category
  • Tomato products. If the product is still essentially a tomato that has been sliced/diced, and has a minor additive such as herbs and spices, then it would fall under the ‘vegetable/ fruit’ category
  • Dried sliced apple falls under the ‘fruit’ category
  • Canned beans or legumes in brine fall in the ‘vegetable’ category
  • Gherkins/cucumber pickled and preserved in a jar fall under the ‘vegetable’ category
  • Flours derived from all grain sources (not including bread mixes)

Products unlikely to fall within clause 11

  • Frozen dinners that contain meat and vegetables as the primary ingredients
  • Sausage rolls and meat pies
  • Dips, spreads, powders, liquids and sauces that contain meat and vegetables as the primary ingredients
  • Soups that contain meat and vegetables as the primary ingredients
  • Canned dinners that contain meat and vegetables as the primary ingredients
  • Apricot fruit bar delights
  • Pasta sauce (tomato and basil flavour)