How to Do Unit Pricing and Nail It


If you’re anything like me, certain things were pretty scary when I was younger.  Standard issue track and swim suits in high school (designed to not be revealing but were *always* too small), mystery meat Wednesdays in the cafeteria, Home Economics, Algebra, etc.  I still get shivers when recalling these.  So what could be worse?

Monsters, of course!  How about unruly, mutant beasts that lurk, drooling at us from store shelves, haunting our Dealicacy dreams and literally engulfing each of our avoidances listed above?  As you probably guessed from the title, the evil we speak of is “Unit Pricing”, where the devil is indeed in the details…

Worse, in order to get those details we must first engage in multi-step formulas that seem only to yield recommendations for generics and stripped-down versions of our favorite things.  And if you’re not so lucky as to find a clear path to savings – a witches brew of sizes, quantities, units that don’t fit or escape direct comparison bubbles over.  Kind of takes the wonder out of why people purchase based simply on pretty packaging, doesn’t it?

What we need is a way to simplify and maximize our shot at determining the best purchase option.  How do we tame this beast?

Bite Sizing.

Every time we break out the envelope and pen (or cell phone calculator) to determine the best unit price, the first thing you need to remember is this: DO NOT LET the store dictate the units you should be using.

We are taught with unit pricing to look at cost in terms of the most basic common unit:

  • Edibles/Drinkables
    • Units: cost per ounce (oz.), fluid ounces (fl oz.)
    • Example: At 25 cents, a 12 fl. oz. can of Diet Mountain Dew = 2.04 cents per fl. oz.
  • Dry Goods
    • Units: cost per roll, piece, count
    • Example: 100 pack of dryer sheets for $4.97 = 49.7 cents per sheet
  • Services
    • Units: cost per hour, minute, second
    • Example: Lawn service that charges $50 a week to do 2 hours of work = $25 per hour

Many stores conveniently list their idea of the least common denominator for you right on the price tag. But think about it, are they really making it easier for you to shop intelligently by doing this? Think about  this comparison:

Campbell’s Cream of Mushroom Soup vs. Kroger Cream of Mushroom Soup

The shelf label will more likely than not carry the unit price in ounces, and for this specific example it’s a good basis for comparison. Both are exactly the same thing: condensed soup. However, what happens when you want to compare condensed soup to a heat and eat (no mixing or reconstitution necessary)?  The grocery store is still going to show price per ounce for both items!

So back to bite sizing, where the advantage should now be clear.  All you need to do is establish a realistic unit of measure that can also be used to describe how much of a product you (or your family) uses at one time.  With food and beverages, you could think of this as serving size.  With toilet paper, sheets instead of rolls.  Laundry detergent, loads of laundry instead of fl. oz.  This also takes care of games marketers like to play with things like “concentrated formulas” and “mega rolls”.

Just be careful with food and drink, as sometimes it’s not as much the serving size you are looking at, but rather the portion size.  As a carnivore, I like seeing whole steaks on my plate when served.  In such a case, go through and pick the lowest cost (and freshest) package with the same number of portions.  Choosing a 3.25 pound packages of 4 steaks versus a 3.5 pound package of four steaks will save you about $1. And even the pickiest of eaters isn’t going to notice their steak had a 1 ounce difference in pre-cooked weight!

Likewise, portion size for beverages tends to grow with the size of the container.  Take soda for example, if you hand a kid a 12-oz can they’ll drink all of it.  Same with a 24-oz bottle.  Pick your appropriate container serving size accordingly.

Now for the real key that will kill the unit pricing beast dead. Once you establish the correct “bite size” for your needs, calculate a benchmark price for what you typically pay (or are willing to pay) for one “bite”. Now anytime you see a price point, you can tell if the individual product is a good buy without having to compare it to anything else.  Simply multiply the number of “bites” in the product you are considering times your benchmark price per bite.  Even better, you’ll have more mental power left over to focus on things like ingredients as well – like buying ketchup without corn syrup, sour cream without stabilizers, etc.

Going back to the Diet Mountain Dew example, if I were to set my benchmark at 2 cents per ounce, I can now tell if ANY size/quantity combination, coupon offer, sale, or other offer is worth messing with:

  • Is the 12-pack at or under $2.48 ?   (2 cents * 12 oz per can * 12 cans)
  • How about the 24-pack?  (2 cents * 12 oz per can * 24 cans) = $4.96 benchmark price
  • And that deal at Walgreen’s where you buy 3 12-packs and get the 4th for “free”?  It had better be less than $9.92 !

By now you might be wondering why I chose ounces and not cans for  my bite size in this example – wouldn’t it make things that much easier?

Yes, it would.  Slightly.  However, I would no longer be able to easily add 2-liter containers into the mix of consideration!  Noting that a 2-liter bottle equals roughly 67 fl. oz. (67.6 to be more precise), I will steer clear of any 2-liter that cost more than $1.34.

Remember, choose a bite size according to your needs and preferences and you’ll win at Unit Pricing every time.

Yours for great deals,

– Nathan

PS – A helpful trick. If you’re wondering about a conversion rate, simply type it into the Google search engine.  Example: Liters to Ounces

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18 Responses to “How to Do Unit Pricing and Nail It”

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