Meiko Gijuku grows franchise revenue despite fewer centres as student recovery supports royalties

Meiko Gijuku’s franchised tutoring business recorded higher revenue despite a decline in centre numbers. In its results briefing for the year ended August 2026, Meiko Network Japan reported 1,150 franchised centres, down 34 year on year, while franchise business revenue rose by ¥88 million to ¥4.261 billion. Recovering student enrolment supported the franchisor’s royalty income and sales of teaching materials.

Franchised centre numbers fall as revenue reaches ¥4.261 billion

According to an article on the results briefing published on 21 October, the decline in Meiko Gijuku’s franchised centre count reflected factors including the closure of loss-making centres and the retirement of older owners. There were 1,150 franchised centres at year-end, 34 fewer than a year earlier.

Franchise business revenue, however, increased by ¥88 million year on year. The company attributed this growth to higher royalty income and sales of teaching materials as student enrolment increased. The distinguishing feature of these results is that student numbers, rather than network expansion, supported revenue growth.

It is important to distinguish what the ¥4.261 billion figure represents: the company’s disclosed franchise business revenue. It should not be read as the total tuition fees and other revenue collected by franchised centres, or as a measure of franchisees’ profits. Growth in the franchisor’s revenue needs to be assessed separately from the financial position of individual franchised centres.

For those involved in Japan’s franchise market, these results illustrate why centre numbers alone do not give a complete picture of business performance. Looking at student numbers and the resulting income for the franchisor alongside openings and closures provides a clearer view of changes across the network.

Total Meiko Gijuku enrolment returns above 100,000

At the results briefing, President and Representative Director Kotaro Okamoto explained that year-end student enrolment across the Meiko Gijuku business had increased by 5,000 from the previous year-end, returning above 100,000. This figure covers the entire Meiko Gijuku business, not just franchised centres.

The company said that revenue and operating profit across Meiko Gijuku’s company-operated and franchised businesses both grew steadily while it continued to invest for future growth. The increase in franchise revenue forms part of this broader recovery in its core business.

Higher student numbers also boosted revenue in the company-operated business. Revenue in this segment rose by ¥767 million year on year to ¥15.272 billion, driven by increased enrolment at centres operated by the company and its subsidiaries. Student numbers therefore supported revenue in both the franchised and company-operated businesses.

However, a recovery in enrolment across the business does not mean that every centre experienced the same growth. Prospective franchisees should treat the national figures as an indication of the brand’s overall direction, without confusing them with conditions in a target area or at an individual centre.

Network restructuring includes transfers between company and franchise ownership

The number of company-operated centres at year-end was 473, down three year on year. The company attributed this to transfers of centres between company and franchise ownership, as well as a programme of closures and replacement openings.

Together with the 1,150 franchised centres, this brought the nationwide network to 1,623 locations. Different factors affected centre numbers in each business: changes in operator and network reconfiguration played a role in the company-operated business, while closures of loss-making centres and older owners’ retirement were among the factors affecting the franchised network.

A decline in the year-end centre count should therefore not automatically be interpreted as a fall in demand. These results show that overall Meiko Gijuku enrolment increased even as centre numbers fell. Assessing changes in the network separately from student demand is the starting point for understanding the underlying picture.

The inclusion of owner retirement among the reasons for closures also highlights the need to consider operators’ personal circumstances, not just profitability. Anyone considering taking over an existing franchised centre should examine its income and costs, the reasons for the change of operator and the terms of the handover.

Assess franchisor income separately from centre profitability

The key to using these results when evaluating a franchise opportunity is to distinguish the franchisor’s business performance from the profitability of its franchised centres. Higher royalty income and teaching-material sales increase the franchisor’s revenue, but do not, on their own, establish an individual centre’s profit or investment payback period.

At franchise information sessions and similar meetings, prospective franchisees should ask specific questions about the outlook for attracting students in their target area, the costs of running a centre, and the terms governing royalties and teaching materials. When taking over an existing centre, practical due diligence should also cover enrolment trends and the operating arrangements that will be in place after the handover.

Questions for the franchisor should not focus solely on national centre numbers or success stories. The reported closures of loss-making centres and owner retirements also provide a basis for identifying what needs to be checked in relation to the proposed location and contract terms.

Meiko Gijuku’s results for the year ended August 2026 show that recovering student numbers supported franchise revenue even as the network contracted. The practical takeaway is to consider centre numbers, student enrolment and franchisor income together, then compare that broader picture with the income and costs of the centre under consideration.