How to Save Money at the Supermarket: Shopping by Unit Price

So, its time to go grocery shopping again, and you realize the funds are a bit tight this time. You'll have to think carefully about what you buy, and one of the best ways to do that is to calculate the unit price of each item you purchase.

What is the unit price? The unit price is the price you pay per unit of the item in question. For example, a package of 10 frozen burritos selling for $3.00 has a unit price of 30 cents per burrito. The unit price is easy to calculate: just divide the listed price by the number of items in the package.

Why is unit price important? Unit price is important because sometimes the cheapest price is not the best deal. For example, Package of Meat A is priced at $6.00 and Package of Meat B is priced at $5.50. At first glance, Package B seems to be cheaper, but if Package A weighs one pound and Package B weighs a half-pound, then it's not quite so obvious. In this case, we would use the lowest denominator (in this example, a half-pound) to figure out unit price. Package B costs $5.50 per half-pound, while Package A costs $3.00 per half-pound. Savings like that can add up quickly.

Don't overbuy. In general, buying in bulk tends to provide cheaper prices. The package of 10 waffles usually has a higher unit price than the package of 20 waffles. For nonperishable goods that you use a lot of, it's almost always best to buy in bulk. But what about perishable goods? Make sure that you'll be able to use everything you buy, or you'll just be wasting money. If your family doesn't drink much milk, it may be cheaper for you to purchase milk by the half-gallon, even if the gallon jug has a cheaper unit price. Wasting food isn't saving money.

Watch out for sales. Supermarkets can be a bit tricky sometimes. Take the following example. A package of 8 hot dogs is on sale 2 for $3.00. But the package of 16 hot dogs sells for $2.50. In this instance, you'd be better buying the large package. Even though it's not on sale, it still has the lower unit price.

Buy off-brand. Off-brand items almost always have cheaper unit prices than the big name brands, and in most cases, they taste just as good. Sometimes, they're even the exact same product, just with a different label. At the very least, purchase the off-brand to see if you like it as well as the name-brand item. If it isn't as good, ask yourself if it's worth it to you to pay more for the better quality.