Why All the Fuss About Eggs?

Posted on 07/07/2009

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U.S. Retail Industry Trends: Cage-free Movement Gains Public Support but Lacks Real Loyalty from Customers and Major American Restaurant Chains

Sunday July 5, 2009

Cage-free eggs have become a hot trend for American restaurant chains, as activist groups are successfully dragging major food retailers into the middle of the ethical food production debate. While both consumers and U.S. retail industry restauranteurs have declared their public support for the cage-free movement, both groups have yet to convincingly demonstrate real loyalty for the cause with deeply committed actions.

Red Robin is the latest U.S. casual dining chain to announce that it will be using cage-free eggs in its restaurants. The company made a public commitment to go cage-free with at least one-third of its eggs beginning this month. By the end of 2010 the company vows that none of its eggs will originate from foul fowl sources.

This is a move that is aligned with the social responsibility that Red Robin demonstrates regularly, and for all of its principle-motivated decisions the company deserves applause. The value of this particular decision to the farm animal welfare movement, however, is really more about hype than substantive impact.

If you scan the Red Robin gourmet burger menu, it’s a where’s-Waldo kind of exercise to find any of its offerings that use eggs. Beyond the fried egg which tops its signature Royal Red Robin Burger, and the hard-boiled egg on its Cobb salad, eggs do not seem to be a key ingredient in any of the 59 other menu choices. So, to put Red Robin’s cage-free commitment into perspective, 30% of the eggs that are used in 3% of its menu selections are now produced by chickens that have at lest enough room to flap their wings.

Mother-may-I take half of a baby step towards the reformation of the horrifically offensive operating practices of farm factories in America? Yes, you may.

Red Robin’s egg use is negligible compared to the restaurant industry as a whole, so its shift to cage-free consumption is not going to make a dramatic impact on the lives of many chickens. This is not a criticism of Red Robin, but more an illustration of the realities of the morally desirable, but logistically challenged cage-free movement.

Currently only 5% of the eggs available in the U.S. today are produced in cage-free operations. Why? Because it’s more expensive and there aren’t enough customers willing to pay the higher price. It’s strictly economics. If every restaurant in America simultaneously decided to stop purchasing eggs that were obtained from sources that were deemed to be “cruel,”there simply would not be enough “humane” eggs to supply the demand.

Regardless of this supply and demand reality, organizations like the U.S. Humane Society (HSUS) and the People for the Ethical Treatment of Animals (PETA) are on the warpath with the cage-free issue, launching high profile campaigns targeted at some of the most popular publicly traded U.S. restaurant chains. McDonald’s was a recent target. At the company’s annual meeting in May, shareholders were asked to vote on a resolution which would compel the fast food chain to begin the transition to purchasing and serving only cage-free eggs. The resolution was initiated by HSUS and PETA, which reportedly own 101 and 79 shares of McDonald’s stock, respectively.

Let’s pause to enjoy the irony of this scenario. McDonald’s sales and stock prices have been flourishing in this recession economy. So, with their stock ownership, both the Humane Society and PETA are both financially supporting and profiting from the very corporate practices that they label as unconscionable. Is anyone besides me amused by that?

In a statement made prior to that shareholder vote, Paul Shapiro, senior director of the HSUS factory farming campaign said, “It’s time for the company [McDonald’s] to realize that Americans are overwhelmingly opposed to this type of animal abuse and begin switching to cage-free eggs.” Reality check, please. It’s time for the animal rights advocates to realize that what Americans say and what Americans do are very often two different things.

While Americans may say in a survey that they are morally opposed to battery-cage conditions, if their behaviors matched their beliefs, they would simply stop visiting the McDonald’s drive-thru at breakfast time. But they haven’t stopped, by the millions. So, in reality, Americans want to have their cage-free chickens and eat their buy-one-get-one-free Egg McMuffins too.

So, everybody is verbally supporting the cage-free outcome, but nobody is proving that they are willing to sacrifice anything to obtain it. McDonald’s same store sales continue to grow, so we can conclude that fast food diners are not as morally outraged as they are hungry and broke. And after 95% of the McDonald’s shareholders voted against the HSUS/PETA cage-free resolution, we can also conclude that the golden profits of the golden arches are more important than the golden rule for a vast majority of the company’s investors.

While I personally support the ideals of HSUS and PETA in this issue, I’m not sure it’s really fair to force corporations to grow a conscience when consumers clearly aren’t purchasing with theirs. When I looked in the egg cooler at my local Publix grocery store this afternoon, the supply of cheap antibiotic-laced eggs produced by hormone-fed, genetically-altered, physically-abused chickens had been depleted quite a bit. The stock of higher-priced eggs produced by happy, free-moving chickens seemed untouched in comparison.

Millions of people will be adding the 99-cent cartons of eggs to their grocery carts this week without regard to the well-being of the twelve hens that pushed out the product. So aren’t the egg end-users the group of people that really should be in the HSUS and PETA crosshairs?

Targeting the fast food companies that make egg sandwiches probably isn’t going to work as long as their cash registers are still getting filled by those who are eating the fast food egg sandiwches. Which comes first – the supply of cage-free chickens or the real demand for cage-free eggs backed by steadfast consuming behaviors? That’s not really an unsolvable conundrum, is it?

To be fair, there are many companies in the U.S. retail industry that make decisions with a moral compass, leading change instead of reacting to consumer whims. Whole Foods stopped selling eggs from battery-caged hens in 2005. Ben and Jerry’s committed to using only cage-free eggs in 2006. Both of these companies have been recognized and admired for their principle-centered practices for as long as they have been in business.

Burger King, Wendy’s, Hardees and Carl’s Jr. have also publicly committed to using cage-free eggs, but at last reports, 98 out of 100 eggs served at these restaurants are still produced by battery-caged birds. I guess 2% multiplied by several chains will add up eventually, but the big accolades that these companies are getting for such small commitments don’t make their cage-free actions seem very authentically motivated.

Should we really be all that impressed by companies that are taking the cage-free high road because it’s good for their image and doesn’t cost them much? Or is eggwashing starting to be the new greenwashing?

If HSUS and PETA supporters walked into one of the restaurants with a 2% cage-free commitment, it’s doubtful that they would be able to specifically request and receive a cage-free egg sandwich there. Let’s face it, though. The HSUS and PETA supporters I know are not exactly the target market for these kinds of retail food chains anyway.

That, of course, is the fundamental challenge. Those who care don’t consume the products and those who consume the products don’t really care. Until one side or the other changes the way they participate in that paradigm, profit-motivated restaurant chains aren’t likely to make any profound changes either.

While there are no real winners in the cage-free battle so far, it is clear that the big losers continue to be the chickens.

Or is it the eggs?