21st July 2023

CMA publishes unit pricing review

CTSI has welcomed recommendations contained in the Competition and Market Authority’s new review of unit pricing practices.

By JTS Staff
Journal of Trading Standards' in-house team
Many of these policy proposals are much-needed, such as making unit pricing more legible, consistent, and more prominent

CTSI has welcomed the publication of a Competition and Markets Authority (CMA) review into unit pricing which makes recommendations for improved legislation to better protect consumers.

The report comes as consumers grapple with high costs of groceries both in-store and online.

The CMA primarily focused its inquiry on the practices of 11 nationwide supermarkets. However, it also considered the unit pricing practices of seven nationwide variety store retailers that sell general merchandise such as hardware, toys, and furniture. It uncovered varying degrees of compliance, with non-compliance worse among variety-type stores than supermarkets.

The CMA’s report makes recommendations to tighten the legislation on unit pricing and notes the thinly stretched resources available to Trading Standards to enforce the regulations. It recommends an amendment to the Price Marking Order (PMO) to make the legislation clearer on matters of legibility and proximity, ensuring that unit pricing is more easily readable for and more prominent. The report also advises that the PMO and relevant weights and measures legislation be updated to specify retailers should use only one unit of measurement per product type, to ensure consistency of unit pricing across channels.

Finally, the CMA recommends that the definition of unit price in the PMO should be reviewed and other weights and measures legislation updated, so that shoppers are able to effectively compare unit pricing of the same product type in-store.

CTSI Chief Executive, John Herriman, said: “We welcome the CMA’s inquiry into the important issue of unit pricing, particularly at a time when consumers are noticing price hikes more than ever with the higher cost of living. Many of these policy proposals are much-needed, such as making unit pricing more legible, consistent, and more prominent compared to the selling price.

“However, we would ask the CMA to go further in clarifying some areas including instances where retailers are exempt from displaying unit pricing to consumers. Currently, stores under a certain size are exempt, but this leaves confusion as to whether smaller branches of large retail chains or concession stands within big stores must provide unit prices. It also potentially leaves consumers without unit pricing in these situations.

“As the CMA has noted, the Society of Chief Officers of Trading Standards in Scotland, and Northern Ireland Trading Standards have discovered broader pricing inaccuracies in addition to these issues with unit pricing, and we are pleased to hear that the CMA will explore partnership with Trading Standards to do similar research across England and Wales, to ensure we get the most accurate pricing for consumers.

“It is good to hear that CMA recognises the pivotal role that Trading Standards plays in enforcing any new unit pricing regulations, however with funding cut by approximately half since 2010 in local Trading Standards services, this provides a reminder of how crucial our officers are in ensuring that consumers get what they pay for during their weekly shop.”

In addition to recommending legislative changes, the CMA has written to multiple retailers to ask that they comply with current unit pricing requirements. The regulator is calling on retailers to introduce accurate, clearly legible unit pricing before any changes are made to the law, in order that customers are able to compare reliably between products.

Small businesses are currently exempt from having to provide unit pricing if they have a store size of less than 280 square metres. That has led to confusion over whether small, local branches of large chains should be exempt, or whether concession stands in large stores are exempt.

The CMA also intends to do further research into consumers’ use of unit pricing and the potential savings that customers can make by using unit pricing in their decision making. A further update to this work will be provided in Autumn 2023.

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