FED up with being price takers, selling cattle at a loss and getting ripped off, Danny Drougas and Alex Petrou realised they had only two options.
Get out of beef farming or completely change tack.
As keen farmers, they opted for the latter and the two men - Danny with a background in horticulture and Alex in marketing and food science - put their heads together and nutted out a plan.
That plan was to continue producing naturally raised, grassfed and chemical-free beef but to cut out the middleman and market the product directly to consumers via the internet and phone.
The pair, who farm with their respective wives and children, put the carefully laid plan into place and discovered it was a winner.
That was three years ago and the huge response since has been well beyond what they ever anticipated.
Demand has outstripped supply, yet Danny and Alex remain committed to their business and still enjoy dealing with customers personally.
It has been a steep learning curve over the past few years, but the pair are confident they have developed a system for viable and profitable beef production.
In fact, they are keen to get like-minded producers on board either to supply cattle or to encourage them to set up a similar business of their own.
"I get so worked up when I see farmers getting a raw deal," Danny said.
"These farmers work so hard and are told they will get nothing for their stock, it's wrong."
Danny and Alex do not see other farmers setting up a similar business as a threat, but a positive move for the beef industry where farmers are in control of prices rather than major supermarkets and feedlot buyers.
"We have decided that we don't want to be price takers for our beef anymore," Danny said.
"The supermarkets and feedlots set the price and we take it, irrespective of whether we make a profit or not."
Danny said the only way for small cattle farmers to remain sustainable at a time of high costs and depressed prices is for them to sell their premium produce direct to the consumer.
"This is before the cattle enter a feedlot where high-protein feeding, rumen manipulators, hormones and chemicals are used extensively," he said.
"There is also a huge price gap between what is reflected on the shelf and what the farmer gets."
Danny and Alex have both farmed at Jack River, near Yarram in Gippsland, Victoria, for the past six years and between them have 100ha where they run separate cattle herds and a combined sheep flock.
They also share machinery and equipment to conserve capital expenditure.
Danny runs close to 100 cattle, including 25 breeding cows, steers and bulls, while Alex manages 63 head including 30 breeders.
Most are Angus and Hereford cattle and all are grown on free-range pastures free of growth promotants, antibiotics and genetically modified feed.
Danny said they enjoyed finding ways to produce stock without using chemical inputs and came up with various innovative ideas and systems.
Once the cattle are fattened they are sold to Danny and Alex's company, Gippsland Lean Beef, killed at a Gippsland abattoir and then taken to a local butcher who ages, cuts, packs, labels and freezes the product before it is delivered direct to the customer's door.
"Our philosophy has been to use local businesses where we can," Alex said.
"We want people in our supply chain who care about our success because our success is their success too."
The direct marketing system allows Danny and Alex to take control of the sale of their produce rather than handing that responsibility to an agent or buyer.
"Rather than a multinational doing it all, it is all local people," Alex said.
"Each section of the business, from farming to butchering to delivery, looks after itself and it is simple this way, leaving people within the supply chain to feel confident about their direction."
The biggest problem Danny and Alex were confronted with was finding a butcher to process the meat because many considered them to be a threat.
They have worked out a good partnership with a Gippsland butcher and believe such a system can potentially benefit butchers elsewhere.
"Butchers are losing money to supermarkets and this (direct marketing system) would be one way to keep butchers viable," Danny said.
The pair are still coming to terms with the success of the business with 800 email enquiries and 10,000 hits on their website in the last month.
"It is phenomenal," Danny said.
"Our customers talk to us and as we continue to grow. We want to be the voices and faces behind it and always encourage customers to come and visit our farms."
They have set strict criteria for growing the cattle and if these requirements are not met, then those cattle are sold elsewhere, ensuring quality is not compromised.
Farmers who supply cattle to Gippsland Lean Beef also have to meet that same criteria 100 per cent of the time and are subject to an auditing process to ensure it happens.
Suppliers are paid the top market price for the week for their stock, which are picked up from their farm with no delivery charges.
"We treat people how we want to be treated," Danny said.
"We are setting the retail price so we don't have to beat anyone down in the supply chain - if that's what it costs then that's what we pay."
They are not concerned about sourcing certain quantities of cattle but instead want like-minded farmers keen to produce a high-quality product and get duly rewarded for it.
"Most small farmers would only need to produce 50 animals a year to make a business like this profitable and their farm viable," Danny said.
"We want people to be part of it and to give them the expertise to set up their own business.
"It may also give jobs to their kids who are leaving to go to the cities."
The company currently delivers frozen product direct to consumers' doors in Melbourne, Geelong, Bendigo, Ballarat, Mornington Peninsula and Shepparton as well as other Gippsland areas but have had queries from as far as Sydney and the Northern Territory.
For more details visit www.gippslandleanbeef.com.au
