Franchise Owners of “Earth Group,” a Major Hair Salon Chain with Over 255 Locations Nationwide, Speak Out! “We’re Essentially Working for Free”

The Shocking Inside Story of a Major Hair Salon Chain

“In the beauty industry, material and labor costs are skyrocketing, and the business environment is becoming tougher year by year. Amidst this, we at Earth Group have an unbelievable rule: ‘We pay absolutely no salary to franchise (hereinafter ‘FC’) owners of stores operating at a loss,’” said Mr. A, an FC owner.

The “Earth Group,” a hair salon chain with 258 locations nationwide, is an industry leader that posted 21.3 billion yen in sales for fiscal year ’24. However, Mr. A and several other franchise owners are reportedly outraged, stating, “We’re essentially working for free, and we’re being pushed to the brink mentally.”

The franchise system is one in which the headquarters provides the brand’s trademark and management know-how in exchange for franchisees paying a set royalty. In principle, under a franchise agreement, both parties are equal and independent business operators. However, at Earth Group, it is said that the headquarters handles everything from managing franchisee sales revenue to calculating the owners’ salaries.

“After working at Earth as an assistant and then serving as a store manager, I went into business for myself. I am currently a franchise owner at a store in the Tokyo metropolitan area. At our company, each store’s sales revenue is first collected by headquarters and then disbursed to the stores as ‘salaries’ and ‘operating expenses.’Headquarters also manages the passbooks and seals for each store’s corporate bank accounts, so even though it’s our own money, we can’t access it freely. On top of that, headquarters takes about 5% of sales—and up to 20% when you include various other fees. We’re barely scraping by…” (Mr. A)

Still, things were fine as long as the “salary” was being paid, but suddenly, a new rule was established.

“I think it was about seven or eight years ago… At a meeting attended by franchisees from across the country, President Toshiharu Kokubu declared, ‘We will not pay salaries to franchisees of stores operating at a loss.’It wasn’t as if we signed a new contract; it was simply announced verbally without any explanation. Since then, while the payment statements show that salaries are being paid, owners of stores operating at a loss haven’t actually received them.”

The November 13–20 issue of *FRIDAY*, on sale October 30, and the paid version *FRIDAY GOLD* feature the reality of Earth Group’s “wage non-payment” and the headquarters’ response to the allegations.

Click here for detailed content and multiple photos ↓↓

From the November 13 & 20, 2026, combined issue of *FRIDAY*