Cypress Holdings targets 10 franchise openings and 10 franchisee companies in FY2027 following first Ginza Sozaiten agreement

On 7 October, Cypress Holdings announced its consolidated earnings forecast for the financial year ending August 2027, setting targets of 10 franchise outlet openings and agreements with 10 franchisee companies. In the previous financial year, it signed its first franchise agreement for Ginza Sozaiten, its charcoal-grilled yakitori brand. In the first year of its new medium-term management plan, the group intends to expand its outlet network in partnership with franchisees.

Separate targets for franchise openings and franchise agreements

Cypress Holdings has set two targets for its franchise business in the year ending August 2027: opening 10 outlets and signing agreements with 10 franchisee companies. It is therefore setting numerical goals not only for new openings, but also for agreements with the companies that will operate them.

This follows its first Ginza Sozaiten franchise agreement, signed in the year ended August 2026 with Sunaga, a large-scale franchise operator. That year saw the group diversify its business, including into prepared takeaway food and franchising. In the current financial year, it aims to build on that agreement by increasing both franchise openings and the number of franchisee companies.

For those following Japan’s franchise market, the key point is that the franchisor is planning to expand franchise agreements and actual openings in parallel. However, outlet openings and the number of companies signing agreements are different measures. A target of 10 for each does not necessarily mean that every company will open one outlet in the same financial year. Future progress should therefore be assessed by tracking agreements and openings separately.

Both figures are targets for the current financial year. Distinguishing the first franchise agreement signed last year from plans that have yet to be delivered is essential to understanding the rollout’s progress.

Annual plan for 30 new outlets, with 22 confirmed

Cypress Holdings plans to open 30 new outlets in the year ending August 2027, including 10 roadside locations. At the time of the announcement, 22 openings had been confirmed. Alongside its franchise targets, the group is making network expansion a central part of its growth strategy.

In the year ended August 2026, it opened 18 outlets, exceeding the 10 planned at the start of the year. Its year-end network comprised 137 outlets, a net increase of 11. New openings count the outlets launched during the period, whereas the change in the year-end total reflects net growth across the network; the two figures should not be confused.

As a new location format, the group opened its first roadside outlet, Tsukiji Shokudo Genchan Kofu. Since opening, the outlet’s sales have been running at more than 130% of budget. The plan for 10 roadside openings this year follows that initial experience with the format.

However, the Kofu figure measures that outlet’s sales against its own budget. It does not indicate performance across the network or the profitability of franchise outlets. Prospective franchisees should treat the success of an individual outlet and the brand’s wider expansion plans as separate factors in their assessment.

Record profits, with further operating profit growth forecast

For the year ended August 2026, consolidated revenue rose 14.1% year on year to ¥12.88 billion. Operating profit increased 11.2% to ¥850 million, while profit attributable to owners of the parent rose 75.8% to ¥770 million. Each of these profit measures reached a record high.

At existing outlets, price revisions took effect and sales reached 102.1% of the previous year’s level, exceeding budget. Growth therefore came from both new openings and higher sales at existing outlets.

However, the sharp increase in profit for the year was partly attributable to the recognition of approximately ¥230 million in additional deferred tax assets, based on expectations for future business performance. Adjusted profit excluding this tax effect was ¥530 million, equivalent to a 39.6% year-on-year increase. When assessing profit growth, it is important to distinguish the reported figure, which includes the tax effect, from the adjusted result.

For the year ending August 2027, the group forecasts consolidated revenue of ¥15.00 billion and operating profit of ¥1.13 billion, increases of 16.5% and 32.8% respectively. By contrast, profit attributable to owners of the parent is forecast to decline 3.5% to ¥740 million. The plan therefore anticipates higher revenue and operating profit, but a lower bottom-line result than in the previous year.

These are consolidated group figures, not sales or profits for individual franchise outlets. They offer an indication of the franchisor’s growth, but prospective franchisees will need a separate assessment based on the conditions of their proposed outlet to judge its financial viability.

Digital ordering and recruitment to accompany expansion

Alongside network growth, Cypress Holdings plans to extend digital systems at existing outlets, including a wider rollout of touchscreen ordering. Its initiatives for the current financial year also include recruiting 210 employees to build the workforce needed for growth.

The group is also considering establishing a dedicated M&A Strategy Promotion Office. This remains under consideration rather than being an existing department. By combining new openings, operational improvements at existing outlets, recruitment and a possible specialist team, it aims to accelerate growth.

For franchise market participants, the next points to watch extend beyond the number of agreements signed: when will those franchisees’ outlets open, and how will their operations be supported? Prospective franchisees should also check individually how the planned digital initiatives and recruitment will apply to franchise outlets, and what support will be available.

The practical priority is to distinguish the group’s growth targets of 10 outlets and 10 franchisee companies from the business plan for an outlet your own company would operate. Before committing, confirm the relevant brand, site and opening requirements, the steps leading up to launch, and the scope of head-office support. The decision should rest on the financial viability of the individual outlet.