Revenues
Revenues derived from our Relaxation Salon Segment were JPY5,972,913 thousand (US$45,315 thousand) in the year ended December 31, 2022 and JPY5,196,540 thousand (US$39,424 thousand) in the year ended December 31, 2021.
The revenue from our Relaxation Salon Segment consists of revenue from directly-operated salons, revenue from franchising, and other revenues. In the year ended December 31, 2022, our revenue from directly-operated salons increased to JPY5,396,294 thousand (US$40,940 thousand) from JPY3,837,514 thousand (US$29,114 thousand) in 2021. Our revenue from franchising decreased to JPY1,163,998 thousand (US$8,883 thousand) from JPY1,359,026 thousand (US$10,310 thousand) in 2021.
The primary factor for the increase in revenues from directly-operated salons between 2021 and 2022 was the increased price per customer, as well as full-year contribution of revenues generated by SAWAN salons in 2022, as compared to only from May to December in 2021. In 2021, our price per customer was JPY6,445, was as compared to JPY6,627 in 2022 (excluding visitors to our JOYHANDS WELLNESS salons located in spa facilities, and a few other salons in which our point-of-sale system is not installed and therefore, comparative financial and customer data is not available). In addition, we sold 19 salons to third-party investors in 2022 under the sale-and-outsource business model. We recognized revenue from such sales of salons of JPY1,122,595 thousand (US$8,517 thousand), while we recognize revenue from sale of salons of US$ JPY559,000 thousand (US$4,241 thousand) in 2021.
The primary reason for the decrease in revenues from franchising was decrease in the number of franchised salons, as well as that we withdrew from therapist deployment business to franchised salons. As of December 31, 2022, the number of franchised salons decreased to 113 from 124 salons as of December 31, 2021, due to our acquisitions of franchised salons and franchisees’ withdrawal from the business.
Our initial franchise fees and expected renewal franchise fees are recognized as revenue ratably over the expected average franchising contract life (7 -10 years) on the opening date of the new franchised salons. In addition, our revenue from franchise royalties includes revenues from recurring royalty income, rental income from subleased salon properties, construction of franchised salons, uniforms and training sales.
Revenue from our Preventative Healthcare Segment increased 778.8% from JPY43,965 thousand (US$333.5 thousand) in 2021 to JPY386,384 thousand (US$2,931 thousand) in 2022. This significant increase was due to (i) our beginning of manufacturing of MOTHER Bracelet® and delivery of finished products to customers who had bought the products in our crowdfunding activity in 2021, which resulted in revenue recognition of previously un-earned revenue, (ii) revenue from sales of MOTHER Bracelet® to business customers, and (iii) an increase in the number of participants in the Health Guidance Program and launch of Lav® app services to consumers.
Revenue from our Luxury Beauty Segment was JPY594,761 thousand (US$4,512 thousand) in 2022, an increase from JPY169,320 thousand (US$1,470 thousand) in 2021, primarily due to the full-year consolidation of revenue generated by ZACC in 2022 , as compared to only from October to December in 2021.
Cost of Revenues
For the year ended December 31, 2022 and 2021, the cost of revenues was JPY5,051,600 thousand (US$38,325 thousand) and JPY3,994,414 thousand (US$30,304 thousand), respectively. The increase was primarily due to salaries paid to SAWAN therapists and ZACC hairdressers as well as increase in the total number of our employed therapists to meet the increased demand after the COVID-19 pandemic, increase in cost of sales of salons due to increased number of salons sold to investors, and increase in cost of MOTHER Bracelet® which we began to sell in 2022, partially offset by decreased cost of franchising due to decreased number of franchisees and decrease in office supplies costs at salons. The cost of revenue as a percentage of revenue was 73.8% during the year ended December 31, 2021 and 72.6% during the year ended December 31, 2022.
The cost of revenue from directly-operated salons increased by JPY847,459 thousand (US$6,429 thousand) from JPY3,281,781 thousand (US$24,898 thousand) in the year ended December 31, 2021 to JPY4,129,240 thousand (US$31,327 thousand) in the year ended December 31, 2022. The cost of revenue from franchising activities decreased by JPY45,553 thousand (US$346 thousand) from JPY691,286 thousand (US$5,245 thousand) in