They are a few iPhone applications that does this but the best one from my search is Pick and Choose.
Making the Grocery Lists
The application comes with a database of 1500 products. You can update the product database to add your favorite products.
I have total control on how I name my products. I like the fact that I can add Tropicana orange juice with lots of pulp to the database. This way, I can send the list to my husband by email and he knows exactly what I want.
Create your list by checking off items as you go, typing new items. For each item, you can specify the quantities in the imperial and metric systems. You can store several lists.
When you are at the grocery store, items are removed as you check them off. and edit mode which checks off items as you go and also allows you to add or modify the quantities.
After a day of usage, I gave a high mark to this simple yet practical application. The maker, Software Designs Dev. Corp., works on adding new features. You can make your suggestions in their forum.
+ Pick and Choose Grocery Edition