At the ISO’s Consumer Policy Committee (COPOLCO) May 2015 Meeting held in Geneva members supported approved unit pricing as a key area. This is in support of the newly established ISO Project Committee ISO/PC 294 – Guidance on unit pricing.
Standards Australia has been appointed ISO/PC 294 Secretariat and John Furbank has been appointed Committee Chair. John is a Standards and Regulatory Compliance Consultant and Executive Member of the Consumers Federation of Australia. Andrew McKay, Project Manager at Standards Australia has been appointed ISO/PC 294 Secretary.
John Furbank said, “This is an important step in assisting millions of consumers worldwide to determine which item represents best value for money.”
In the competitive spirit of retail trading packaged goods are sold in a multitude of quantities. Many foods are packed in odd sizes such as 87g, 135g or 410g. Some packers change package sizes to avoid apparent price rises per item or to meet a particular price point.
Unit pricing means displaying the unit price of an item adjacent to the selling price. For example for a 500ml carton of milk offered at $1.95 the unit price would be $3.90 per litre.
UNIT PRICE = PRICE OF ARTICLE/QUANTITY
Shelf label from New York State, USA.
A unit price may be displayed on the shelf adjacent to the goods, on the package, in printed catalogues, in-store promotional material and on-line advertising.
Unit pricing is particularly helpful to vulnerable consumers such as the young, elderly those who do not know the native language, or those who cannot read. It is also helpful to those with low incomes.
When package sizes and prices are in odd amounts (e.g. 410g at $2.79) it is difficult for consumers to quickly calculate the price per kilogram or litre or compare prices for a similar item. This leaves consumers baffled as to which tin or bottle is the most economical purchase.
Take for example different-sized tins of tuna on sale at $1.99 for 95g, $2.75 for 145g and $3.69 for 185g. Which tin would be the best value? In this example it would be cheaper to buy the 145g tin.
The market share of pre-packed food and non-food products is very high in many counties and is increasing very rapidly in many others. Many retail chains operate across national boundaries and use the same system for marking prices in all their stores irrespective of pricing practices in neighbouring stores.
In countries that do not have unit pricing, the level of economic risk to consumers is high because of their inability to determine which item is the best value for money.
In countries that have unit price legislation, a standard will be beneficial as parts of the standard could be voluntarily adopted by retailers to improve the quality of unit pricing and could act as a catalyst for changes to improve any legislation or guidelines.
An international standard will promote the alignment of future regulatory requirements for unit pricing, which will be of benefit to both consumers and suppliers.
The proposed standard would provide principles and guidance in designing, developing, implementing, maintaining and improving a flexible, responsive and effective and measurable regime for small to large traders including establishing best practices for explaining to consumers what unit prices are and how they can be used.
It is proposed for the standard to include guidance for the manner in which quantity is expressed including weight, measure, count and area; as well as the prominence and legibility of unit prices.
“A unit pricing standard has the potential to save consumers across the globe millions of dollars by taking the guesswork out of buying,’” said John Furbank.
To date the ISO Central Secretariat has registered 7 participating members and 11 observer members to ISO/PC 294. National Standards Bodies and interested ISO Liaison Organisations can still get involved. For more information contact Andrew McKay of Standards Australia at firstname.lastname@example.org.
Standards Australia has recently established a mirror committee CS-116 Guidance on unit pricing which will include a CFA representative.
John Furbank Chair ISO/PC 294