This is Part III in a series on saving money on groceries. This post focuses on the value pack vs. the smaller sized package.

As I'm grocery shopping, I take several things into consideration as I make my choices.

In trying to get the best buy, I don't always buy the cheapest, or the largest.

Most of the stores have a cost per ounce sticker under every item. When they do, it's easy enough to figure out which one is the best buy. If one item costs five cents per ounce and the other one is seven cents per ounce, the five cents per ounce item is the best buy. In the back of my mind, I always hope the person who calculated the tag knew what they were doing.

Sometimes the stickers are missing, or the store doesn't provide that service.

Sometimes they'll have some arbitrary numbers which give no information, like $1.37 per each. Maybe these tags were created by someone who didn't know how to calculate cost per ounce? Knowing the price per “each” doesn't help you figure out which is the best deal for your money. This one costs $1.37 per each and that one costs $1.69 per each. Well, you might think the $1.37 one is the best buy, after all, it's the cheapest. But let's say the $1.37 bag of popcorn weighs 24 ounces, but the $1.69 bag of popcorn weighs 36 ounces. Which is the best buy?

When it's not clear, I pull out my calculator. I take the money amount and divide by the ounces. Let's look at the peanut butter, which is the best buy? We have three choices:

8 ounces for $1.09
22 ounces for $1.69
24 ounces for $1.99
60 ounces for $6.98

Let's take the first example: $1.09 divided by 8 = $0.136. Just under fourteen cents an ounce.

#2: $1.69 divided by 22 = $0.0768. Just under eight cents an ounce.

#3: $1.99 divided by 24 = $0.0829. Just over eight cents an ounce.

#4: $6.98 divided by 60 ounces = $0.116. Almost twelve cents an ounce!

People will sometimes grab the biggest container, thinking surely it's the best deal. But surprisingly, that's not always the case. I know that to be true, but it always surprises me. As you can see in my example, the biggest container costs nearly $0.12 per ounce, while the smallest container costs just under $0.08 per ounce.

Oh, now hold on a minute. There's a sale on peanut butter, buy one get one free! It's the expensive brand, the “real” peanut butter with no fillers and additives, my favorite. It's $2.39 for one 18 ounce container. But I'll get two for the price of one, so I'll take $2.39 and divide it by 36, which comes to $0.066 per ounce. That will be the best deal. By mere fractions of a penny, but it's still the cheapest.

You might wonder why would anyone buy the 8 ounce jar of peanut butter? Why, you'd end up paying $3.27 for 24 ounces. That's almost double what the 24 ounce jar costs.

Okay, what if you happen to be a person who only eats a tablespoon or two of peanut butter in a week's time, and you live alone? You might be better off buying the smallest, most expensive container since that little container will last you four months. If you bought the 24 ounce jar, which would take you one year to use up, it might taste rancid by the time you get halfway through it. If you throw out half the jar, you'll end up paying 16 cents an ounce for the peanut butter you did use. So in the long run, if you eat minuscule amounts of peanut butter, you might be better off buying the most expensive per ounce.

Now back to that popcorn. You tell me, which one was the value buy?