Brian Daly interviews Three Bean’s Director, Matt Howe, to find out more about Three Beans Cafes early adoption of higher welfare eggs and his perceptions of the egg industry in Australia.
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Opening quote: There is row after row of hens shoved in cages, expressing no natural behaviors whatsoever. And it was absolutely silent. And you were thinking what the hell is going on in here and you'd go to a free range facility where, you know, noisy is anything lots of movement in and out of the barns. Very, very different.
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Brian: Hello and welcome to RSPCA Australia's humane food podcast series. My name is Brian Daly and today I'm talking with Matt Howe founder and director of Three Beans cafes, a rapidly expanding franchise that is renowned for offering ethically sourced and humanely farmed food. Welcome to the podcast, Matt.
Matt: Thanks, Brian. Nice to be here.
Brian: Before we get into the Three Beans story, your experience in the food industry is quite impressive 17 years with McDonald's in the UK, rising to senior vice president you implemented changes that are given McDonald's size, significantly improved the quality of sourcing from an ethical and animal welfare point of view on a large scale. Can you tell us a bit about that and how it has informed your attitude towards food production?
Matt: Yeah, sure. I mean, McDonald's was an amazing company to work for. I've been qualified as an accountant and I managed to, you know, work my way through the business to end up having some responsibility for food and supply chain. And in the UK, in particular, there was always a very strong customer focus on food, where it was from what companies did with it, etc. Probably because in the UK, people are closer to the land, you know, there's farming outside London, you don't travel great distances to see foods produced there. So there was always a strong interest in food and McDonald's had some pretty amazing agricultural programs, so they had their own McDonald's approved agricultural program. That had strong controls around the movement of cattle between farm and slaughterhouse, and then worked with Temple Grandin, who developed really intricate systems within slaughterhouses to remove the stress from the animals as they move through them. So they already had some really strong practices, but we found in the late 90s, early 2000s, there was a lot more focus on food. So McDonald's went early to sourcing of free range eggs really hated the intensive facilities. I mean, it's amazing. You going to cage facility and it was absolutely silent. And you were thinking what the hell is going on in here and there is row after row of hens shoved in cages, expressing no natural behaviors whatsoever, and you go to a free range facility where you know, noisy is anything lots of movement in and out of the bands. Very different. And I think that opened the eyes of the execs in the UK company to welfare issues. So then we've linked in with the FAI, the farm animal initiative near Oxford. And that was a group of researchers who were looking at creating sustainable, ethical and humane farming systems that could actually function profitably. And so they worked on barn systems for rearing of pigs in family groups. And you know, the outcomes for that we're making sure there was no tail biting. So big thing within intensive pig rearing is the tail dock and they teeth clip. Yes, because the pigs are so bored. They'll attack each other. Yeah, but if you develop enriched environments, they don't. So you can have them in big barn systems with enriched environments, playing and toys and things like that. Expressing normal behaviours and you wouldn't have to tail dock or teeth clip them. Yeah, so we did that we moved to organic milk in coffees, you know, then moved into recycling all the use cooking oil into biodiesel for the fleet. A number of really, really interesting projects. I left in 2007, just before they moved towards implementing the enriched family farm pig system, but I went through everything within the, you know, the intensive, which is pretty confronting when you see the intensive system for raising poultry hens. Where the grown super quickly indoors, you know, in these, you know, you're almost dressed like you're walking into a disease area where, you know, you can't bring any germs in, you know, the highly clean systems to ensure no spread of diseases. And that's a pretty confronting an eye opening intensive agricultural system. So that informed a lot of what we do my brother and I do it Three Beans.
Brian: Yes. And say you said you from a accounting or commerce background your brother had run a number of cafes and restaurants. Have you always been interested in food as well?
Matt: No, I'm not. Not really. I worked for Piney concrete in Sydney while I was at uni, and I went backpacking, so I left Australia to go backpacking ended up in London after three months around Europe, then went backpacking around South America, fell in love with someone in London went back to London and fell through the doors of McDonald's when I was there, so you know, so no, I had no kind of connection or anything else apart from the fact I love food and ended up there so yeah, and stay there for 17 years had kids in London and we moved back to Sydney in January 2008, as our kids went to secondary school, so, you know, and obviously very close to my brother and we talked a lot about food and directions in food and people becoming far more educated about where their food comes from. And he and I just decided to do Three Beans together.
Brian: So it's like a happy accident of your careers that just brought you back together, I guess in a way and, and obviously caring about where food comes from was a major connection you guys had and formed a major part of your philosophy.
Matt: Oh, absolutely, like James’ strengths and his wife Peter are chefs, I always come back to Sydney and come back and see them near Manly. And they would cook the most amazing food so they've always had this, you know, incredible relationship with food and they were always they personally without talking to me, we're always concerned about the origins of their foods and you know, they were always freaked out about the kind of bizarre, huge chickens that you could get it Some things like that, yes. So you know, they obviously became more educated. I talked a lot to them about it, I shared a lot of experience about where things were going in the UK with it. And they felt they would kind of hearing about it here, although not as loudly as it was happening over there.
Brian: And as you said, we have a different relationship with farming here, where it's away from the cities, it's something we don't see. And as consumers we, we tend not to be confronted with the realities of farming as you as you said, as you would have in the UK.
Matt: Yeah. And you know, it's, it's fascinating, isn't it? Because people who do travel, they travel up the coast that you know, what is it 80% of the population live in the cities and on the on the eastern seaboard? You don't really see where production is. In the UK, you can drive out of London and you can see free range pork farming by the side of the motorway. Here you just don't see that, you've got to tend to go a long way. Like even the market gardens in Sydney have disappeared as urban sprawl. Kind of heads out. So you probably see Cattle in fields and sheep but not much more than that, they'd never seen intensive you know, agricultural feedlots? We definitely not see chicken production, free range production, you just wouldn't see it. So you wouldn't know. And I think a lot of the things we do get to see always the bad things about farming or the shocking incidents of some live export of cattle you know, being slaughtered overseas in what people would describe as barbaric slaughterhouses and things like that. They don't see the good parts of agriculture. You know, lately they've seen the vegan activists and you know, and I, fair enough, whatever the vegans , but they're really vilifying people who do the right thing animals that have a great life. Yeah, there's a middle ground. And I think the RSPCA is a big part of that middle ground. So it's important that doesn't get lost in the noise of those guys. You know, my experience with farmers is they care deeply about the welfare of the animals. You know, I've never met a farmer who wants to do the wrong things. And then their caught in a system of producing food at a price because the supermarket's demand a price and consumers demand the price for the product. And there's no doubt that higher welfare product is more expensive to produce.
Brian: Yes. And you know, that you've committed to that and I you know, you serve RSPCA approved eggs from Rohde’s in South Australia. And there are obviously suppliers closer to Sydney, where you're the majority cafes. But what did you see in Rohde’s that made you quite literally go the extra mile to source your eggs.
Matt: Oh, look it probably went back to the UK where we at McDonald's was 100% free range eggs. And there was a probably in the early 2000s, there was an interesting thing that came out that suggests that the number of UK free range eggs being sold exceeded the actual production of free range eggs in the UK. And so there was some fraud happening within the system. And we had some amazing free range farmers, this guy from the north of England who had smaller sheds had lots and lots of ground cover, because the reality is if there's no ground cover, birds won't roam because they they're scared of predation, scared of predators. So it's all very well, sticking a barn in the middle of the field and opening the doors but if it's just open grass, the birds won't roam because they're very scared about predation. So I had a really interesting conversation with this farmer. He was telling me about some new free range production coming online in Scotland, where they were building multi storey barns where the birds just wouldn't roam. Even though they'd open the sides of the barns, the birds wouldn't roam. So there was all this crap around free range production where a lot of the bigger producers were trying to come up with ways of doing a barn system rather than a free range system. So when I got back here, we spoke to the RSPCA because there was so much crap out there with the big egg industry players wanting to set the standards for free range, you know, the poultry gamekeeper do everything themselves and they want to do 20,000 or 10,000 birds an acre, yes. Which is not free range that's intensive and they know as well as I know, well, they didn't know I knew that that was not free range and I even had an egg producer a big one come and doorstep us in our old kitchen. Ask him why we why we no longer purchase from them as a supplier no longer purchase their free range eggs and I was brutally honest with him. I said, mate, you're not free range. You may like to label your eggs free range, but I know your birds aren't ranging. I know that this is purely a, you know a profit based formula for you. I know you said well, you could have my organic eggs, which obviously have different standards, you know, I checked and so that's what he was saying that his organic was actually free range but he's free range wasn't so I spoke to Hope Bertram at the RSPCA and I think at the time it might even be true today. There were only two RSPCA certified free range egg farms. Yes in Australia. And we spoke to Rohde’s and really like them. We saw what they did, and so we get a pallet a week of free range eggs so you know that we can't use them 100% in our own internal baking, we've got to use some pasteurized Liquid free range eggs that we get from another supplier. But all about fresh eggs and a lot of the eggs in our baking are directly from them and all the stores get them and they're a great product, but they're there people care.
Brian: Yeah, so the RSPCA Approval, that was really important then for you.
Matt: Absolutely. Cuz I know they audited it, I haven't got the manpower with five people in our office to go do audits. The farming practices and I know for my time in the UK dealing with the RSPCA and here, that that's what they do. You know, yes. So I'm in it. I'm far more confident in them doing it than an industry doing their own.
Brian: Yes. doing their own checking of their own people. Yes, absolutely. Yes. And you know, and i know I have been down on the Rohde’s farm and it is a great operation and, and they do go through those processes and as you were saying like Free Range doesn't necessarily mean free range anymore because the 10,000 birds per hectare is ridiculous whereas the aerospace standards are 1500 birds or less so, you know, you're getting a genuine product I guess. So that's that that's what it comes down to for you.
Matt: Well, you know, the birds living a good life and they're expressing natural behavior. And that's the most important thing and you know what, there are higher welfare standards for barn production which the RSPCA you know, audits as well. But I think for us, it was more about the natural behaviors.
Brian: Yes. Any animal should be able to express those. Absolutely. And do you find your customers recognize that are RSPCA approved?
Matt: Oh, some, like there are definitely some that do and they'll tell our franchisees they'll talk to us but for some people it's meaningless. You know, I mean, I hope the message gets through and but you know, that's not important for us, the important thing for us is we're doing the right thing. And it certainly means something for some people I but my honest belief is it's gonna mean more, because the more news that's out there around farming techniques and intensive versus extensive agriculture, and the more people can educate by it, then I think the more people will, will appreciate it. Yes, yes. And you know, it is more expensive, there's no doubt it is a lot more expensive.
Brian: And how do you how did you manage that? the commercial side of running an enterprise like three beans, which is you know, growing really well, but to, to add in that extra cost to production and also the sourcing eggs from far away, for instance, like from, from Adelaide.
Matt: Yeah. What we did was we, I guess, when the business started before I got back to Sydney, we didn't have our own commercial kitchen. So my brother James was sourcing products from different suppliers. And so we were sourcing all the baked goods from, you know, other companies that made cookies, muffins, and breads, etc. And one of the things as we grew was we had our own kitchen to build our own kitchen, our own baking chefs, and we bake ourselves. And what we found was that we could bake using free range eggs, some organic products as well, and produce that product, sell it to the stores at a better price than they were paying previously from a third party. So from our perspective, we felt that we could make money running around kitchen supplies in the stores and from the stores perspective, they got an immediate benefit because the cost that they were paying, I think we had to cut initially by about 30 or 40%. So there was a there was a win win in it. Where it's difficult, And it's difficult for the stores and we have to keep reinforcing it is around pork. So we get pork through Zammit, who gets it from Borrowdale who gets it from Gooralie free range farm. And there's no doubt that the cost of bacon is double what you'd pay for an intensively reared system. And oh, my God, if anyone and I think this is probably and it shouldn't, it shouldn't be more shocking than chicken rearing, but it is if you go and see intensively farmed pork or pigs compared to free range, it's abhorrent. You know, birthing stalls, concrete sheds, you know, it is abhorrent, and there is no justification for it, you know, that they'll there'll be people who argue that they bred maternal instincts out of the stock of pigs mean there'll be all sorts of crap that you hear from it, and it doesn't have to be that way. It can be definitely be changed.
Brian: Yes, yes. Obviously, because there are different systems that are running already.
Matt: Correct. Yeah. Yeah. And you know what, there's sometimes that people need to pay more because the cost of production for those systems is appalling. And you know, it really shouldn't be allowed.
Brian: Yes. And and we're seeing that the people will pay more, we're buying more free range eggs and cage free eggs in the supermarket. But still, I think there's that lack of awareness, I guess that there's still 11 million hens in battery cages, for instance, in Australia, and the majority of those go into food service. So like, yes, restaurants and cafes, like yours are so yeah. So you making this ethical choice and others like you is really important in reducing demand for that, that caged egg system and intensively found bacon as you say, do you see that there is a there's a growing understanding or that by choosing free range and by choosing cage free when you go to a restaurant now is also something that can help in the battery cage.
Matt: Oh, absolutely. I mean, I think I think interestingly, in Europe, the European Union legislated against battery cages, which drove industry as well, which was a good thing. So there is a role for the government, I think, yes. You know, there are times when government needs to govern and not listen to the lobby groups around some of this, which is what we saw the first time out with the free range and the industry winning a preposterous document. Yes, but I think supermarkets definitely, in Coles and Woolies promoting a lot more around free range and RSPCA certified systems. And you know, they've got big advertising budgets, it's front and center, and it definitely will change consumer perception. I think, you know, I think those are the two areas but then consumers are going to choose but it's difficult, isn't it if you're going to your local cafe or restaurant it probably not Thinking about the ethics of the food that they're serving. And, you know, they're small businesses and they, they want to give you great tasting food, but they've got to make a profit too. So, you know, sometimes there's got to be a personal view, there's got to be some form of intervention or leadership from government to start steering the industry, it's in the right direction.
Brian: That's right. And the poultry standards are under review at the moment. And it would be good to see, as you say, some leadership to say it's time that we started phasing out this intensive system of production for these animals.
Matt: Yeah, and it's also when you get down to the cost per, you may be talking about 20 cents difference per egg. I mean, it's not going to break the bank no matter what and I don't want to sound like some elitist right winger, but you know, it's not a significant increase in cost to do the right thing.
Matt: And I guess this is part of your wider ethical approach it at Three Beans, isn't it? Not just with food, but also in the way you structure, the franchise, the way you use recycled fitouts, biodegradable takeaway containers, you obviously see all these things being linked to better outcomes for animals, consumers, customers and the planet.
Brian: You know, we're not perfect. I wouldn't ever want to say that we are, you know, we're always looking to see what we can do. What the next step to take is, is it affordable? I mean, it's very easy for James, I'd have to make a decision that affects the welfare of our franchisees. So you know, we've got to think about them as our business partners, with every decision we make, but yeah, we're always looking to do better, and always talking to suppliers about what we can do better. There are challenges you know, there are challenges around recycling in this country. So just because something's biodegradable or compostable or recyclable, doesn't mean that happens. You know, that's another big issue in the country, we have the infrastructure to do the recycling isn't even there, you know, everything was being shipped overseas, sold to China, you know, there was money in selling the waste stream to China, and they've blocked that off. So, you know, again, we need some leadership from government to create the economic model around all these things. But yeah, you know, we want to do better. And for our franchisees, we don't take big fees, we don't do any of that we make money by selling products to them from our kitchen. So a whole model is trying to be equitable in the model between the customer, the franchisees, our suppliers, and James and my future. Or our ability go for surf a few days.
Brian: Wait, that sounds like a good business objective.
Brian: Now, and you're old mates at McDonald's and other large food chains. You know, getting back to the cage free eggs. They've also switched. We've got commitment from the large retailers the Coles and Woolies to, to phase them out. Do you sense that there is an end in sight there is there is a time when no one will have to suffer like, like they do in these barren battery cages in Australia.
Matt: Oh Jesus, there's got to be there. I mean, I think if those big corporates actually took their people through the production cycle or from farm to plate, they'd have a real sort of crisis of confidence around the whole industry and make the change quicker. I mean, obviously the infrastructure needs to be built up to enable the change. It's not something you can turn on overnight. It's just unrealistic. But I'll tell you why. One thing I did I took all the executives through the supply chain and took them from farms all the way through abattoirs and out the other end to make them see you know, they should know where the food comes from. They absolutely every single one of them should see it and know it intimately because what they sell yes or no and if you do I don't think in all good conscience, you could condone those practices. I don't get it.
Brian: It's something that as you said, you know, in the UK, they're a little more close to the farm land in the cities. But about here we, we tend to say, well, that's happening over there. And I don't really need to know about it.
Matt: Correct. But I think I think, yeah, there are a lot of accountants running these big companies maybe get out in front of the computer and through there, and that would give them a shock.
Brian: When you've been trailblazing in that area there Matt. They do that so it's great to it's great to hear what you're doing there. It sounds like you know, you and James have created a great example of how to run a food service business that that is ethical and as you say, is always trying to improve and make sure the food you're serving is humanely farmed. It's inspiring stuff. I wish you every success. With Three Beans.
Matt: Thank you so much.
Brian: We've been speaking with Matt Howe from Three Beans cafes and thank you all for listening. If you would like any more information about RSPCA’s commitment to helping end the battery cage, visit the RSPCA Australia website at rspca.org.au. You can also subscribe to the podcast series at the website. All the usual podcast suspects. I'm Brian Daly and I look forward to your company next time on the RSPCA Australia humane food podcast.