Woolworths explains item’s confusing $2.80 price discrepancy amid surging inflation

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An everyday Woolworths item has caught the eye of one Sydney customer and no doubt caused confusion with a bizarre price discrepancy between different-sized bottles.

On the shelves at the Woolworths store in Marrickville were two different sizes of Woolworths Essentials olive oil. The 500mL retails for $3 and the 1L bottle will set you back $8.80.

Anyone with basic maths skills can quickly work out you're paying more if you opt for the larger bottle, contradicting the general belief you can save by buying in bulk.

A closer look at the photo shared with Yahoo News Australia shows the tag on the shelf for the 500ml bottle shows the unit price is $0.60 per 100mL, while the 1L is $0.88 per 100mL.

Retail expert at Queensland University of Technology and Chair of the Australian Retailers Association Professor Gary Mortimer said this slight price hike between the two products was quite unusual.

The unit price on the larger size of the Woolworths brand oil is more, which is unusual. Source: Supplied
The unit price on the larger size of the Woolworths brand oil is more, which is unusual. Source: Supplied

"Normally, the larger the pack size, the lower the unit price and that's because less packaging, less processing, and therefore you buy in bulk you get a lower unit price," he told Yahoo News Australia.

He said in this instance, it appears the two bottles of olive oil, which are the same product just in different sizes, is the "the exception and not the rule".

When asked why the unit price for the bigger bottle is more, Prof Mortimer suggested it could be a temporary price reduction or Woolworths could be getting rid of the product.

While some may have assumed it was a mistake, the prices were listed as the same on Woolworths' website.

Woolworths explains bizarre pricing detail

A Woolworths spokesperson set the record straight, saying the difference in the unit price was due to an increase in the cost of olive oil.

"Globally, the production cost of olive oil has increased and this is reflected in the shelf price," a Woolworths spokesperson confirmed to Yahoo News Australia.

"We know value is important to our customers and that's why we're able to offer a 500ml bottle of Essential olive oil priced at $3 and if customers would prefer to buy a larger size our 1L bottle is priced at $8.80."

How checking the shelf label could save you thousands

While to some, checking the unit price might seem tedious, it usually pays off.

Prof Mortimer headed up a study around consumers and unit pricing and found a family of four could save up to 18 per cent or $1700 annually just by checking the unit price.

"We've certainly found in our research that consumers still don't really look at the unit price that often they tend to be swayed and conditioned by the retail price," Prof Mortimer said.

Supermarkets like Woolworths and Coles display the unit price on the shelf, and looking at it can help consumers make a more informed decision. Source: AAP
Supermarkets like Woolworths and Coles display the unit price on the shelf, and looking at it can help consumers make a more informed decision. Source: AAP

According to the Australian Competition and Consumer Commission, every large supermarket and some online grocery retailers must have the unit price displayed alongside the selling price, unless the item is exempt.

So by looking at the unit price, consumers are making a more informed decision when shopping that can add up in the end. So take advantage of the unit pricing when possible.

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