maximizing product quality and the synergy between hens, crops, soil, and farmer.

1. What is free range?

There are three basic definitions of free range (as it applies to chickens). One is correct; two are bogus. The correct definition is, "Free-range poultry are, for practical purposes, unfenced, and are encouraged to spend most of their time outdoors, weather permitting." Free-range poultry are often not fenced at all. When they are, the fences need to be very distant from the birds. True free-range flocks are generally fed and watered outside. This encourages the birds to spend time outdoors and keeps the houses cleaner and drier.
If the fences confine the birds to a smaller area than they would normally use, the practice isn't free-range at all. It's yarding. Yarding provides an entirely different set of management challenges from free-range.
Bogus definition #1 calls poultry with any access to the outside "free range," no matter how small or disgusting their outdoor yard is. This is the definition used in the US by the USDA. This definition has the advantage of being obviously bogus.
Bogus definition #2 is the European Union's definition of "free range," which is what you'd get if you took the USDA definition and had a PR firm give it a facelift. It's still just yarding.

2. What's wrong with yarding?

It all comes down to the amount of manure the land can handle, and the geometry of chicken yards. A grass sod can handle about four tons of chicken manure per year. That's the output of 80 chickens. So, unless you want to kill off the grass and pollute the area with runoff, you can't have more than 80 outdoor chickens per acre. What's worse is that the manure is never evenly distributed across the yard. It's concentrated near the chicken house. This would kill off all plant life near the chicken house even if the chickens didn't scratch all the sod to pieces, but they do this as well. A more sustainable number is 50 hens per acre.
Fifty hens per acre is about 800 square feet per hen. That's a lot of area. Hens also don't like to travel long distances. They'll go 100-200 yards from the hen houses, in reasonably good weather,  if properly encouraged by outdoor feeders and waterers.
As an exercise for the student, try to design a hen house that holds 10,000 hens (a typical "free-range" production unit in Britain) at 2 square feet per hen, and provides each hen with 800 square feet of yard within 200 yards of the house. It can't be done! The maximum number of hens that can be supported by a house in the middle of a square fenced yard is 450.

3. How do they manage 400 hens per acre in European "free-range" flocks?

They cheat, that's how. The EU regulations allow 400 hens per acre but insist that the yards remain green. If that many hens actually went outdoors, the grass would be destroyed in no time. The manure load of 400 outdoor hens is also unsustainable, leading to dead grass, high levels of nutrient runoff, and a disgusting muddy yard in general unless you remove the nutrients from the ground one way or another. On the other hand, if the hens spend almost all their time indoors, the grass can remain green. Since chickens eat and drink many times per day, you can manage their movements pretty well by careful placement of feeders and waterers. The basic scam in Europe appears to involve putting the feeders and waterers as far from the outside doors as possible, to use as few doors as possible, and to make the doors as small as possible. A few hens will wander around outside, providing window dressing, but most will stay indoors.
The upshot is that most "free-range" flocks are really confinement flocks surrounded by a nice lawn. To produce the dark yolks associated with true free-range flocks, many producers add special ingredients to the feed solely to color the yolks. Another smoking gun that shows that the flocks aren't free range at all is that, with true free-range flocks, feather-picking and cannibalism are rare; such behavioral problems are caused by confinement. But I've read from multiple sources that virtually all British "free-range" commercial flocks are beak-trimmed to prevent cannibalism. It's enough to make you despair.
The producers even have the nerve to claim, after doing everything they can think of to discourage the hens from ever venturing outside, that "chickens don't like to go outdoors." Everyone who has ever had a small flock knows that chickens will spend most of their time outdoors if the weather isn't too dreadful and you provide feed and water outside.
It's all very sad. The regulations were apparently written by people who had not tapped the wealth of practical free-range experience of prior generations of farmers. Some of the best books on practical poultrykeeping ever written were by British authors, but I don't think that the people who drafted the regulations have read them.

4. So how do you do it right?

First off, you need to recognize that proper free-range egg production is just one use of a diversified farm. Otherwise, you can't make proper use of the fertility you get from the chicken manure, and you won't be able to justify to yourself the use of all that land for a flock of chickens that could easily be crowded together in 1/100 the space. Also, you need to keep in mind that most of what you read about on the topics of farming and animal welfare is written by city people who don't get out much. They swap these stories around, but real farming isn't like what they put in their magazines. So if you're putting your own money in the game, start small and keep your eyes open, because there's a lot of misinformation out there, and believing it could easily drain away your savings.
Free range is pretty much synonymous with portable houses. I use small portable hen houses, which I move with a tractor once the ground around the houses becomes muddy. This is the traditional approach. Other people are experimenting with larger houses, typically greenhouse structures build on skids. This is okay, too, though I'd stake down such lightweight houses very firmly if I were you. At the moment the trend tends towards tight confinement within electric poultry netting (yarding) combined with very frequent house moves (every 1-3 days). I predict that this will slowly evolve into the use of a very distant or nonexistent perimeter fence (free range) combined with infrequent house moves. The labor savings are greater this way, but you have to be willing to let the grass under the house die from being scratched to pieces by the hens. With low stocking density, a scattering of bare rectangles here and there on the pasture is of no great importance. By using outdoor feeding and moving the feeders around every time they go empty, you can get most of the effect of moving the houses, but with less effort.
This is much more labor-intensive than the faux free-range most people use, so it's not worth doing unless you can get high prices. I believe that real free-range eggs won't be widely available in city supermarkets unless the price is five times as high as generic eggs.
One reason you can get away with infrequent house moves is that the manure in a litterless chicken house becomes drier and less obnoxious the longer the house sits in one place. I'm not exactly sure why this is, but it's true. The first few days a house is in a new spot, the manure on the floor is wet and nasty. If the house has been in one place for a month, the manure is quite dry and there is no smell. Moving the houses too frequently maximizes the wetness and smell.
On clay soil, the mud problem makes it important to keep a solid turf at all times. Permanent pasture is the simplest way of achieving this, though a crop rotation with grasses or clover as one phase will also work. On sandy or gravely soils, cultivating the soil does not lead to an instant mud problem, so keeping the chickens among growing crops is a viable alternative. Chickens love shade. It keeps them cool, out of the wind, and protects them from hawks and owls. Corn, kale, and sunflowers, planted with wide spacing between the rows and often with a ground cover of grass or clover in addition, are traditional chicken crops. When the crops ripen, the plants are knocked over and the chickens thresh out the grain or eat the leaves themselves. The chickens must be kept off the crop fields when the crops are young, but once the crops are big enough to withstand scratching, the chickens can be turned loose among them. This is the method preferred by Milo Hastings in The Dollar Hen.
Hedges and structures like board fences can also provide the shade and windbreaks that will help the chickens to spend most of the day outdoors. Careful placement of feeders and waterers to encourage ranging is also useful. This can be overdone -- in really hot, sunny weather, the chickens may prefer being thirsty to covering a long distance in the hot sun, sometimes with disastrous results. At the very least, the chickens shouldn't be forced to go indoors for feed and water. Feeders and waterers should be scattered at convenient intervals across the range.
Running hens among trees is also a possibility. Hens will roost in the trees, which is a nuisance and causes the egg yield to fall precipitously in bad weather, since food energy must be diverted to keeping warm. This is not a problem with modern broilers, which do not fly. The appropriateness of running chickens among fruit trees depends on the type of fruit. Tree crops that are allowed to fall to the ground before being gathered are a bad choice unless having your chickens eat them is part of your plan. In many countries, paranoia about bacteria levels will prevent you from running poultry among the trees.
Eggs from chickens who spend a lot of time outdoors and eat plenty of fresh green plants taste better and have darker yolks than those of confinement hens, and the meat is also more flavorful and better-textured. This superiority forms a solid basis for attracting quality-oriented customers who are willing to pay premium prices for premium products. Range can also reduce feed consumption somewhat and allows a simplified diet, though less than people often suppose. Click here for an old-time description of this.
Ninety years ago, a flock of 2,000 free-range hens was considered a manageable size for a farm where eggs were the primary product (that is, where the other crops grown were incidental and mostly fed to the chickens); flocks up to around 1,000 hens were kept on diversified farms. Washing and grading eggs, delivering them to stores, and selling them at farmers' markets can easily take more than half the total time involved with the egg business.
In the pastured broiler business, it is much the same. Butchering, packaging, and delivering the broilers is usually more time-consuming than raising them.
To keep an operation profitable, it's very important to recognize that you can't participate in the commodity market. This means producing the best product you possibly can and marketing it to the most discriminating consumers you can find. It's essential to receive high prices, or you will go broke.
Certification programs tend to create new commodities, and commodities bring low prices, so approach them with care. For example, the U.S. has a lot of second-rate certified-organic eggs that are at least as bland as supermarket eggs. In many cases they are worse, since I have seen a lot of  "alternative" eggs with a sell-by date 45 days after packing, as opposed to 30 days for eggs packed under USDA inspection. Also, I've seen a lot more evidence of poor refrigeration with alternative products, such as milk and eggs that have been shipped long distances. I suspect that at least some of the distributors and wholesalers are not as sensitive to the need for quick sale and careful refrigeration as they ought to be. This can give you the home-court advantage if you are more meticulous than the competition, but only if your customers can tell you apart.
More details on how free-range hens are raised on my farm can be seen in my free-range presentation. For a much more far-reaching treatment, you should buy a copy of The Dollar Hen. Admittedly, it was written over 90 years ago, but I still learn something new every time I open that book. If you are interested in free-range or pastured broilers, you need to buy a copy of Joel Salatin's Pastured Poultry Profits.

 Thanks to:
http://www.plamondon.com/faq_freerange.html

Read Our Book About Free-Range Egg Farming!

This is a good place to plug our re-released book, The Dollar Hen: The Classic Guide to American Free-Range Egg Farming by Milo M. Hastings, Edited by Robert Plamondon (Norton Creek Press, 2003, $18.95). You can buy The Dollar Hen right here on my Web site. First issued in 1909, Hastings discusses problems and solutions in practical egg farming in a way never equaled since. Full of fascinating insight and timeless wisdom, it shows how free-range poultry production can be be done practically and profitably, by maximizing product quality and the synergy between hens, crops, soil, and farmer.