How Handsome Brook Farm conquered America
In 2008, Betsy and husband Bryan Babcock were selling their pasture-raised backyard eggs at local farmers markets near their home in Upstate New York. Today their produce is sold in over 4000 locations in 48 states across America. We talk to co-founder Betsy via a Google Hangout to hear how Handsome Brook Farm have utilised an often overlooked community to scale their operation across America, becoming one of the fastest growing food companies in the US in 2016.
So do you think of yourselves as a challenger and, if so, what does being a challenger mean to you in the context of your business?
We've really caused a significant amount of disruption in the egg industry through how we produce eggs and how we care for our chickens. We've taken what was a sleepy egg category and transformed it now into something where people are passionate about eggs, where they are becoming more and more aware of the differences in egg types and demanding improved quality in animal welfare.
We’re also scrappy, we’re not a big business. We came in and started at grassroots level and said we want to do the right thing, we started small and have expanded from that point.
The prevailing notion is you can’t make any money as a small scale farmer, so what have you done differently to make Handsome Brook Farm a commercially viable business?
What we have done is created a new segment in the industry that didn’t exist before. Our eggs are pasture raised, as opposed to cage free, free range or even organic. Our typical farm has 5,000 hens in a barn and it has 12 and a half acres per barn. So that comes out to a 108.9 square feet per hen, a number based on the European metric system, which is why it comes out to this really weird number.
That is in comparison to a cage free barn that will have a million chickens in a barn or a free range barn that will have 100,000 chickens in a barn. So in terms of scale we require more farms for the same production of eggs.
But we have tremendous efficiencies. Our mortality rate is lower than the commercial egg farms are. And our production rates are higher per chicken than the commercial, because they’re less stressed. And because they’re in a more healthy environment we have better living conditions and thus better production.
So actually treating them more humanely, giving them the pasture raised translates to happier chickens that lay more eggs.
What are the ambitions you have as a brand, both in commercial terms as well as non-commercial terms, as in the change you want to see in the world?
Our ambition is to be on every single grocery retail shelf in the United States within the next 12 to 24 months. It’s a very aggressive strategy but we feel that consumer awareness around eggs is starting to emerge and this is a real opportunity for us to do the right thing and do it quickly.
From a broader perspective, Europe and the UK are actually ahead of the United States in terms of animal welfare for poultry. Free range in the United States is a meaningless term, whereas in the UK it does mean access to pasture. But here in the US we have a real problem in terms of transparency and in terms of animal welfare for poultry and so we really want to change that.
What was the opportunity that got you into this initially?
My husband and I had semi-retired; we bought a small farm in upstate New York, because we just loved that area. We had a few chickens, a few sheep, few pigs and opened up a bed and breakfast really just so that we had the ability to meet new people.
We really didn’t expect anyone to come, because we’re three and a half hours from New York City and it’s so not an easy drive, but people did come. And what we found was that people would rave continually about our eggs. And that was really the impetus for us to do research in terms of how are our eggs so different than any other egg in the dairy case.
And as we looked into that we realised that organic chickens never go outside, free range chickens never go outside, cage free certainly never go outside and that chickens going outside is important, both for their welfare and for the quality of the egg.
So you got into this industry by accident and with little experience, can you talk a little bit about any advantages you see from that inexperience?
We came into this with business knowledge, but not egg industry knowledge. And that was our biggest advantage. Because we just approached it by thinking ‘this is the right thing to do’, not how has it been done before. And that made us think differently, we approached how we work with farms differently.
A challenge and an advantage at the same time is our focus is on small-scale farming. So instead of having a million hens in a barn cranking out eggs like a factory, we work with small Amish farms and Mennonite farms that have a sustainable focus, and that is completely different from what the egg industry traditionally does.
The industry thought we were foolish, their opinion was number one, chickens don’t like to go outdoors, which as you and I both know that’s bogus. And number two, you can’t make money on small scale farming, which is also not true. And we made money, because we just did things differently and we came into it without any expectations of the way things should be done.
So what constraints might working with the Amish community impose on a business? How has that given you an advantage versus the big players?
A misconception that I had about the Amish community was that I thought that they didn’t use telephones or any kind of technology at all. They do have access to telephones; it’s a shared phone, a couple of hours in the morning, a couple of hours at night, so they can call us.
But the thing that is so impressive about the Amish communities is their communication; they have a very successful way of communicating with each other by phone or by word of mouth that is just unfathomable, so it’s actually turned out to be really helpful for us.
One of the barriers for a lot of companies that would want to do what we’re doing, is being able to recruit farms. And we have a really good reputation within the Amish communities so when we say we need more farms, we’d like some outside of North Carolina, they get in touch with their relatives, and all of a sudden we have new Amish communities in North Carolina that we’re working with.
We can pick up additional farms just by putting the word out that we need them. And they call us, we’re not having to go out and chase down farms.
Do you work exclusively or primarily with Amish farms, how would you characterise it?
Probably 90% of our farms are Amish, the other 10% are Mennonite. That’s not by design, it’s just the way it evolved. It’s not that we would not work with non-Amish farms, but just so far our relationship with the Amish communities has been great.
It’s good for people to learn that not everything happens by plan and by design. You’d mentioned that you had a business background before, were there any perspectives you had from your prior business background that were instrumental in seeing this industry differently?
Both Brian and I have always had an entrepreneurial streak in us, we’ve always had a day job and then had a little business on the side. And our philosophy has always been don’t try to tell the consumer what they should have, but approach it from what is the consumer asking for and what are they appreciating.
Prior to starting the bed and breakfast I had a full time job at Celergo, an international payroll company based out of Chicago. My responsibility for Celergo was to manage the partner relationships with accounting firms throughout the world.
The firms would do all the payroll accounting and Celergo would orchestrate the process and be the client facing person to the process. And so when we came up with the egg contract management model, it was actually based upon this contract management model from the payroll company.
So a completely different industry, but it sparked in my mind, oh, we don’t have to raise every chicken, we can contract this out with other farms, have a wonderful relationship with them and be the client facing aspect of it, but also have our operational controls in place.
One of the common challenger narratives that we’ve identified through our research into challenger brands is what we call the ‘Next Generation’ brand. So I’m just curious in your brand narrative, do you think about yourselves as being the next generation of egg farming or are you simply going back to basics?
It is back to basics in that this is what Grandma or Great Grandma did with her chickens. Grandma’s farm had 20 chickens and served Grandma and a couple of friends. All we’re doing is replicating that environment and that way of raising chickens.
But what’s futuristic is the fact that we’re able to scale it. We’re able to scale it to make it available for people who don’t have access to a farmers’ market. So it’s a new twist on something that is as old as time.
I know you’re a privately held company, but could you share any results, again commercially and non-commercially so that people can get a sense of the impact you’re having?
Back in 2007, we had seven chickens. Now, in 2016 we have 400,000. By the end of the year we’ll have 200 farms, so that’s about a million chickens. So in terms of the volume of hens, seven to a million chickens in just a few years. So the growth has been tremendous.
In terms of retail, we started doing farmers’ markets. We’re now close to 5,000 stores in all 48 States in July. So we partner with Kroger and Publix and H-E-B as well as the small independents too. So revenues have gone up along with that.
The industry as a result of our involvement to some extent, is changing in a very substantive way because we have made the option available and made people aware of better options than the restrictive poultry environments.
Betsy Babcock's advice for a challenger brand
- Surround yourself with people you trust. The key to our success has been the people that we’ve been surrounded by and the support we’ve had from them.
- Know what your core values are as a business and as you grow to not abandon those. You’ve really got to know who you are, be authentic and stick to that.
- Find something to be grateful for each day. Growing a business can be stressful, so try to have a spirit of gratefulness.