Orange City Council received eight submissions after putting planning changes for the Forest Road site on public exhibition.

The plans aimed to change zoning to allow retail, initially a small supermarket and specialty shops, but also raised the possibility of a larger shopping centre in Stage 2.

A submission from IGA supermarket owners Ian and Rochelle Ashcroft said Bloomfield was only seven minutes drive from the CBD and the proposal would "undermine" the CBD shops.

"Currently the Orange shopping centre is suffering from a high level of vacancies which will get worse when the COVID-induced recession takes hold," they said.

"It is incomprehensible to [us] that council would be encouraging more retail business, so close to the Orange shopping centre, when retail businesses in the Orange shopping centre are already suffering extreme financial stress."

Paul Saunders, the director of BMPS 88 Pty Ltd. which owns the Summer Centre, said it was the "complete antithesis" of plans to revitalise the CBD.

"The low value land being proposed for rezoning will create an unfair competitive advantage for CBD retail centres to compete on retail rental values," he said.

"This will over time, encourage the major supermarket brands to move out of the Orange CBD, permanently damaging the prosperity of the town CBD and its economic viability."

Melissa Gregory, the owner of Bobbies Clothing in Summer Street, said it would take "millions of dollars" away from the CBD.

She said she was also concerned about a drain on the city's water supply and traffic issues for Orange Hospital.

Kate and Tim Gray from Peter Smith Terry White Chemmart in Summer Street said many empty shops were vacant.

"There are 12 empty shops in the [upper] block alone and with the current COVID-19 restrictions and the steep decline in overall retail sales it seems unconscionable that council would be seeking to encourage an additional retail development," they said.

McCarthy's Pharmacy owner Paul Jones said the plan would impact the CBD.

"What is proposed is more than just a convenience store, but rather a medium-sized supermarket with specialty stores," he said.

"Approving this is tantamount to giving long term approval for a 3000 square metre supermarket at this site, which is proposed in the future, and be operational by 2024-25."

He said it could mean people from out of town coming to Orange for medical appointments would bypass the CBD and shop at Bloomfield.

Kim Rossi and Dino Cunial, owners of commercial properties in Orange, said the development would create little new business.

"The majority of the proposed supermarket's business will be made up from Orange's existing supermarket sales," they said.

A staff report to Orange City Council recommended the zoning change go ahead which would allow for a small retail area.

However it recommended council do not approve Stage 2 which it said would not likely be needed until at least 2026.

The report said the planning changes, and possible expansion of the North Orange shopping centre, had been considered by council's economic consultant Peter Leyshon.

"[His advice] recognises there is sufficient demand and population to support a modest expansion of retail floor space in Orange but also advises caution in both the quantum and location of that expansion," it said.