Industry responses to a call to expand unit pricing into hardware stores.
In submissions to the Federal Government’s review of the Retail Grocery Industry (Unit Pricing) Code of Conduct, consumer groups including CHOICE and the Consumers Federation of Australia have called for unit pricing to be extended to hardware stores.
Unit pricing is an element of the tickets you will find in supermarkets across the country. Grocery items are shown with their price per package (say, $7.99 for 250g of cocoa) and then also per unit, often 100g (here $3.20/100g). It makes it easy for consumers to compare products on price – a 400g box of cocoa retailing for $11 would be $2.75/100g – though it makes no distinction as to comparative quality between brands.
When the same product is available in different sizes, however, it can be a quick way to spot a genuine bargain. A 375g peanut butter on a 25%-off sale for $3.75 ($1/100g) is still not as good a deal as the normal-priced 780g jar at $6.50 (83c/100g).
Unit pricing is required in the bigger supermarkets and online grocery retailers in Australia. Small stores and stores that sell a limited range of unit prices are not required to show unit pricing on their tickets.
From a consumer association point of view, they see little difference between the practicalities of buying a litre of milk or a litre of paint, so why should one come with more useful consumer information than the other?
However, hardware industry associations TABMA and Hardware Australia are concerned. They see it as a time-consuming and potentially expensive impost on small businesses for little consumer gain.
Unlike groceries, where milk is milk and people can choose to buy on price, or clearly marked qualities such as organic or lactose-free, or preferred brand, a spade might actually be a shovel or a post-hole digger.
Most independent hardware outlets carry limited options by type of product and rely instead on a vast variety of products, which is a logical decision when your customers can be anyone from builders and plumbers to parents doing a deck or students adding shelves to a rental.
Even the example commonly given by consumer advocates is misleading: they pointed out it is vastly cheaper per unit for our hypothetical student to buy 100 or 1000 screws than a pack of 20. Which is true. Except that putting up a shelf takes four, so there’s no point ‘saving’ money on something you won’t use.
TABMA and Hardware Australia have joined forces to represent hardware retailers on this issue and are looking for input from retailers. To add your voice, contact David Little via David.L@tabma.com.au