Pricing standards

Displays of prices by businesses must be clear and accurate. The total price of a product or service must also be displayed. Certain grocery retailers must also display unit pricing on their shelf labels.

How pricing control works in NSW

The Independent Pricing and Regulatory Tribunal of NSW (IPART) is the independent pricing regulator for services supplied by the NSW government including:

• water
• energy
• public transport
• local government costs.

IPART sets maximum prices and conducts pricing reviews of these regulated services to:

• protect consumers from unreasonable price hikes and price gouging
• ensure regulated service providers remain financially viable
• encourage regulated service providers to improve economic efficiency and maintain or improve service quality
• encourage competition where possible.

Unit pricing

Supermarkets and online retailers must comply with the Unit pricing code if they sell certain food-based grocery items. Unit pricing allows consumers to quickly compare products of different sizes and brands to work out which one offers the best value.

The Unit pricing code is a mandatory industry code under the Commonwealth Competition and Consumer Act 2010. It applies to:

• grocery retailers with more than 1,000 squares metres of floor space who sell the minimum range of food-based grocery items
• online retailers who sell the minimum range of food-based grocery items.

Smaller retailers not covered by the Unit pricing code may choose to adopt unit pricing if they sell the minimum range of food-based grocery items. However, if a retailer opts-in to unit pricing, they must comply with all the code's requirements.

Displaying unit pricing

A retailer subject to the Unit pricing code must display a unit price for all grocery items, unless it is exempt.

The unit price for a grocery item must be prominent, legible and unambiguous. It must also be in close proximity to the selling price for the grocery item.

The Unit pricing code sets out the unit measurements that must be used for each kind of grocery item. Most products will use one of the following forms of measurement:

• if sold by volume - per 100 millilitres
• if sold by weight - per 100 grams
• if sold by length - per metre
• if sold by number - per item for a pack of 40 or fewer items; or per 100 items for a pack of 41 or more items.

Some grocery items must be unit priced using an alternative unit of measurement (see clause 11 of the Unit pricing code). For example, fruit and vegetables, which are commonly sold by weight, must be displayed as per kilogram rather than 100 grams.

The unit price must be displayed in dollars and whole cents.

Displaying prices for promotional offers

Generally, unit prices must be displayed for items on special. This includes times where 2 or more of the same items are offered at a discount.

A retailer does not have to display unit prices if:

• different grocery items are being sold together in a bundle, for example, a soup kit consisting of carrots, potatoes, onions, split peas and stock
• similar items of different sizes or weights are being sold at a single price, for example, a range of different sized chocolate bars being sold for $2
• the item has been marked down because:
  • the packaging is damaged
  • it is perishable
  • it has been discontinued.

Multiple pricing

Multiple pricing is when a business displays more than one price for the item or service. When this occurs, the supplier must:

• sell the item or service for the lowest displayed price, or
• withdraw the item from sale until the price is corrected.

A displayed price is when a price is published in a catalogue or advertisement. 

Retailers can correct a printed pricing error by publishing a retraction in a publication with a similar circulation to the original advertisement.

Component or drip pricing

'Drip pricing’ is when a price is advertised at the beginning of an online purchase, but then extra fees and charges (such as booking and service fees) are gradually added during the purchase process. Common in airline, accommodation and ticket booking services, this can lead to the customer paying more for an item than they realised.

Businesses can apply some fees and charges, like booking and service fees, however, they cannot mislead customers into paying these fees without advising up-front how much it will cost.

Businesses cannot promote or state a price that is only part of the cost, unless they also prominently advertise the single (total) price. This means that customers should be able to identify the total price in an advertisement just as easily as prices for all the other aspects.

The single price must be:

• clear at the time of the sale
• as prominent as the most prominent component of the price.

The single price is the total of all measurable costs and includes:

• any charge payable
• the amount of any tax, duty, fee, levy or charges, for example, GST or airport tax.

Exceptions to component or drip pricing

This rule generally does not apply in business-to-business transactions. This means businesses do not need to include GST if a price statement is made exclusively to other businesses.

A service that allows periodic payments does not have to display a single price as prominently as the component prices, such as telephone or internet contracts that are billed monthly.

Optional charges, extras or delivery charges do not need to be included in the single price.

Surcharges at restaurants and cafes

Restaurants and cafes that charge a surcharge on certain days do not need to:

• provide a separate menu
• price list, or
• have a separate price column with the surcharge factored in.

When applying a surcharge, the menu must include the words “a surcharge of [percentage] applies on [the specified day or days]” and these words must be displayed at least as prominently as the most prominent price on the menu.

If the menu does not have prices listed, these words must be displayed in a way that is obvious and visible to a reader. These measures apply to pricing for both food and beverages.

Comparison pricing

Businesses may make comparisons between product prices. This might include the price they are selling an item for now along with:

• the price at which they previously sold that item (‘was and now’ pricing)
• the ‘cost’ or wholesale price
• a competitor’s price
• the recommended retail price (RRP).

It’s against the law for businesses to mislead consumers about the price of an item or service. 

For more information on comparison pricing, including what is and is not allowed, visit the ACCC website.

Making a complaint 

When making a complaint, you should include:

• details of the issues you are experiencing
• copies of any correspondence that shows how you have tried to resolve the matter.

How NSW Fair Trading will handle your complaint 

Your complaint will be reviewed to determine the most appropriate resolution. This may include:

• providing you with information to help resolve your complaint
• recording the complaint issues to assist in future compliance programs, or
• contacting the other party to try and resolve the dispute.

You can lodge a complaint: 

Online

If you cannot resolve your matter, submit your complaint by using our form.

Make a complaint

By mail

Post your complaint form and documentation to: 

NSW Fair Trading

PO Box 972 

Parramatta NSW 2124 

Ask a question 

If you are unable to find the information you need, you can call us between 8:30am to 5pm on Monday to Friday. You can also use our form to make an enquiry. 

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