Excerpted from Stilgherrian:
“During the 1960s and 1970s, all manner of technology arrived more or less at once. The herringbone milking shed and then the rotary milking shed made it possible for a farm worker to milk more cows. Rural roads were paved, and diesel trucks became bigger, faster and more reliable. Bulk handling equipment was introduced, with milk stored in refrigerated tanks until collected by tanker truck every two or three days. Milk factories became larger, and fewer in number. Factories paid less for milk, and farms needed to scale up to hundreds of cows to remain viable.
Husband-and-wife dairy farms were disrupted out of existence.
Nearly half a century later, Toffler’s Third Wave of the Post-Industrial Society is now rolling across rural Australia. It splashed upon Hogarth Range, 750km north of Sydney, and one of the newly evolved critters in the shallows is a premium beef supplier that’s — dare I say it? — disrupting the meat industry.
David and Peta Moloney and family had lived in Canberra for a year, and weren’t impressed with the meat available in supermarkets. High prices, even though farmers were paid just AU$3 per kilogram for the meat, and low quality thanks to the time it took the meat to make its way through the supply chain.
“This is so wrong,” David Moloney told ZDNet this morning. “There’s a whole lot of expenses in getting it to the supermarket, and refrigeration costs, and transport costs, wastage, and so forth.” Peta Moloney came up with idea of eliminating all that, David said. “I put together the business plan, and the website and all the technical side of it, and away we went.”
And thus, in 2004-05, Honest Beef was born.
The concept is simple. Honest Beef sells directly to consumers, who order 20-kilogram “beef packs” and other standard packages. “Six to seven of them is one animal, and when we get seven orders, we ring up the farmer and say, ‘What weights have you got?’ and he says, ‘I’ve got one of those’, and away it goes, off into the abattoir,” Moloney said.
“The idea is that the animal’s still running around the paddock when you make an order. We don’t store beef at all. We have no refrigeration, we have no nothing,” he said. “We’re cash-flow positive. We get paid before the animal’s dead.”
When it’s “fully consigned”, as Honest Beef’s explanation coyly puts it.
“We don’t do PayPal, we don’t do any of the credit cards. They charge too much, that eats into our profits, and we have to pass that on to the consumer. Direct payment and Bitcoin, they cost us nothing.”
Yes, Bitcoin.
Honest Beef started accepting the digital currency earlier this year. Is anyone using it? “Plenty,” Moloney said. “The last two animals we sent off, we had [those] two pay by Bitcoin, and we’ve got a third waiting. We’re probably getting 10 to almost 20 percent of our customers paying by Bitcoin now.”
Now, there’s nothing particularly high-tech about Honest Beef. There’s a website and Bitcoin, sure, but the rest is just telephones and trucks, emails and evisceration.
There’s plenty of ways to scale it up. Farmers could register their cattle by location, weight, and condition. A mix-and-match algorithm could find the best way of assembling customer orders into a reverse-jigsaw puzzle that shared out the slaughter to minimise time and travel, and maximise profits. But why bother?
Honest Beef illustrates what becomes possible when you start thinking of every business as something as a service. Or, as futurist Mark Pesce put it last year, when every business is an API.
Honest Beef taps into commodified road and air logistics, and commodified digital banking and communications — all the generic stuff that’s delivered globally at “cloud scale” because it’s the same whether you’re selling beef or tomatoes or shoes or children’s toys or helicopters — and uses that infrastructure to deliver your personal share of a dead cow from a particular valley in northern New South Wales at a flat rate of AU$10.75 per kilogram. And the farmers keep 70 percent of that.”
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