Price ladders across pack sizes: how to build one and where it breaks

Six rules make two people draw the same ladder from the same shelf.

1. One rung per pack point. A pack point is brand, subsegment and total size. Flavors of the same brand, subsegment and size are one rung. If their regular prices differ, use the average over the flavors.
2. One container and format per ladder. Bottles and cans, or cups and tubs, serve different occasions. Draw each ladder alone first, then draw them together to see where they cross.
3. Size means total quantity. Count times size each, in one unit. A 12-pack of 12 fl oz cans is a 144 fl oz rung. The conversions and the pitfalls are in price per unit analysis.
4. Use regular price. A pack with no regular price is left out of the ladder and named. Never place it at its deal price.
5. Merge near-identical sizes. Two packs a few percent apart in size are one rung for judging steps. They form a crowd, not a step.
6. Mark guesses. A size parsed from a product title can be wrong. A wrong size draws an inversion that does not exist.

The fourth number is the index to the core pack: a rung’s unit price divided by the core pack’s, times 100.

The first two steps save 12.0% and 13.6%, and each is exactly one doubling, so the per-doubling figure equals the step discount. The step from 32 to 48 fl oz is an inversion: 20.0¢ per fl oz against 19.0¢. The step from 48 to 128 saves 25.0%, which is 18.4% per doubling because the pack is 2.67 times larger.

What marginal price adds

Marginal price is the cost of the extra ounces. It rises above the smaller pack’s own unit price exactly when the step is an inversion: the extra 16 fl oz in the 48 fl oz pack cost 22.0 cents each, against 19.0¢ for every ounce in the 32 fl oz pack. That sentence is the one to say to a buyer. A marginal price at or below zero means the larger pack costs no more in total than the smaller one, which is wrong unless the two are different formats.

On log-log axes, a ladder that gives the same percentage off at every doubling of size is a straight line. That is the working model: unit price falls by a fixed share each time size doubles. For a reference pack with unit price u0 at size S0:

Two ways to set d. Fix it from a convention and draw a corridor around the core pack. Or fit it: take the least-squares line of ln(unit price) on ln(size) across the rungs; its slope b gives d = 1 − 2^b. Shelfprice’s default screen uses a corridor of 10% to 15% per doubling and lets a category set its own. That is a convention for finding candidates. We found no primary source for a correct value.

The anchor matters. Measured from the 32 fl oz core pack, the 128 fl oz rung falls inside its corridor, yet the step into it from the inverted 48 fl oz pack reads as steep. The steep step is a side effect of the inversion. Repair the inversion and re-check before you touch the big pack.

Replace the convention with your category’s numbers

A convention is a starting point. The better yardstick is the category’s own distribution: compute every brand’s step discounts per doubling, then look at the median and the quartiles. A step in the tails is a candidate. The real savings on shelves vary widely, as the next example shows.

In Example 1 the ladder shows three of the five. The 48 fl oz rung is an inversion. The step into the 128 fl oz rung reads as steep (18.4% per doubling against a band of 10% to 15%) and the 2.7-times jump in size is a gap, since no pack stands between $9.60 and $19.20.

How common is an inversion?

The honest answer is that it depends on the category, the country and how you count. Sprott, Manning and Miyazaki studied quantity surcharges in grocery pricing in 2003. A Purdue release from 1999 reports that larger canned tuna sizes were often 20 percent more per ounce. A 2026 New Zealand study found about 26 percent of 40 products with a surcharge across 38 supermarkets. The UK CMA found cases in toilet roll, cheese and laundry pods across more than one retailer in its 26-item basket and called them relatively unusual. Treat an inversion as a finding to check, not as a rare event and not as a rule.

Deliberate breaks

An entry pack priced high per ounce is working as designed. A flat step above the entry pack can be a convenience premium. A large pack can be priced to a club-store comparison. None of these is a defect. A break becomes one when nobody chose it.

Draw the ladder at regular price and treat deals separately. A deal can turn the ladder upside down for a week without any change in structure. Take Example 1 and put the 16 fl oz pack on a deal at $2.88. Its unit price falls to 18.0¢, which is 5.3% below the 32 fl oz pack at 19.0¢. Two 16 fl oz packs at the deal price cost $5.76, against $6.08 for the 32 fl oz pack. A shopper who buys two small packs pays less for the same 32 fl oz. The UK CMA found promoted items were often, but not always, the cheapest per unit, so a deal is a finding on its own: how often, how deep and on which rungs.

Move one rung and you change two steps. Repair the largest inversion first, then recompute everything, then look at the flags that remain. In Example 1, the 48 fl oz rung sits outside its corridor, which at that size runs from 17.3¢ to 17.9¢, or $8.29 to $8.57 a pack. A price of $8.40 lands inside it at 17.5¢.

A price cut is one repair. Raising the 32 fl oz pack or deleting the 48 fl oz pack also clears the inversion, each with its own side effect on the neighbors. Who can do what matters: the manufacturer controls sizes, counts and its list price, and the retailer controls the shelf price. Whether a repair pays depends on volume, margin and elasticity, which a shelf does not show. The architecture article sets out the levers and a cash-margin model for the trade-off.

1. Rungs are pack points at regular price, in one unit, in one container and format.
2. Every step has a step discount and a discount per doubling. Every negative step is flagged.
3. Marginal price is checked on every step the buyer will question.
4. Steps are compared with the category’s distribution, not with a rule from a web page.
5. Gaps and crowds are checked against size ratios, not by eye.
6. Each flag is checked against a pack role and a lever before it is called a defect.
7. After any change, every step is recomputed.
8. Deals are reviewed on their own.

1. Applying a good-better-best gap rule to pack sizes.
2. Drawing the ladder on pack price instead of unit price.
3. Counting each flavor as a rung.
4. Leaving multipacks off, or treating a 12-pack as the same rung as a single.
5. Using the shelf price with deals in it.
6. Reading one retailer as the market.
7. Calling every break a mistake. Some are designed.
8. Not naming who can fix it.
9. Reading a log-scale chart as if it were linear.
10. Comparing ladders across brands without matching units. Fluid ounces are not ounces.

• Short ladders. Two or three rungs give a step or two and no curve. A fit through three points proves little.
• Close sizes. A step between nearly equal sizes cannot be stretched to a full doubling without blowing a small price difference up into a huge percentage. Shelfprice does not call a step flat or steep unless the larger pack is at least 1.3 times the smaller.
• One curve does not fit every product. The Example 3 savings differ by a factor of two per doubling. Fit the category before adopting a band.
• Packs with different jobs. A trial size and a stock-up size sit on one ladder because of arithmetic, not because they compete.
• Concentrates and per-use products. Price per ounce misleads when the product is diluted or used by the load. Add a per-use ladder as a second view.
• A snapshot. A ladder is true on the day it was drawn at the stores that were sampled. The CMA says as much about its own examples.

Shelfprice draws these ladders from Kroger group shelf prices, one container and format at a time, at regular price, and checks every step against the category’s band. It plans the repairs of one ladder together: a raise stops one cent under the next bigger pack’s price, and a cut brings down any bigger pack that would then cost more per unit. It sees shelf prices and sizes, not your sales. The PPA analysis page describes the product.