Harvey Norman is investing in its Australian store network as it looks to encourage more shoppers through the doors, with customer traffic reportedly down between 10 and 20 per cent despite sales growing over the financial year.
Total sales for Australian franchisees increased 2.4% to $6.58 billion in FY26, with a strong first half helping offset more challenging retail conditions later in the year.
Sales increased 4.8% during the first half, supported by improved consumer confidence, a more stable inflation outlook and Christmas trading, before declining 0.2% in the second half as inflationary pressures weighed on households and consumer confidence softened following the May 2026 Federal Budget.
Harvey Norman executive chairman Gerry Harvey explained the decline in store traffic was being experienced more broadly across discretionary retail.
“It’s across retail everywhere, except Chemist Warehouse. But discretionary retailers like us, JB Hi-Fi, The Good Guys, Bunnings, all the furniture shops, bedding shops, they’re all in the same boat as us.
“When we walk through and talk to our opposition, they’re all saying customer count is down.”
Harvey Norman is investing in refurbishments to improve its stores, alongside a major promotion on outdoor goods beginning September 1.
“What we’ve done, we spent a lot of money doing up our shops to a state that when they walk in, it’s a very good environment,” Harvey told AAP.
Two refits are currently in progress, with the retailer planning to commence another four over the next 12 months. Harvey Norman also intends to open one new franchised complex in Australia during FY27 and relocate four existing complexes, including three to newly constructed freehold properties.
The retailer recorded profit before tax of $790.29 million for FY26, up 4.9% on FY25, while its Australian franchising operations delivered profit before tax of $345.18 million.
Australian franchisee sales declined 3.4% in July, which the retailer attributed partly to the timing of major product launches. Comparable written sales for the period from August 1 to 24 were up 3.8% on the corresponding period.
