Nic Drage from Games n More on Summer Street had opened his shop at 10am on Easter Monday.
Eight customers were registering for a noon event when, at about 11.30am, a person entered and asked if Mr Drage had seen the smoke coming from above Cafe Latte next door.
"I came outside and thought maybe at first it was cigarette smoke, but then realised it was fire smoke, so I told our customers to get their things and come outside," he said.
Mr Drage phoned 000 and then contacted his father, who rang Cafe Latte owners Aaron and Emma Wright.
"I went out the back, which is where the access to the apartment [upstairs] is, and checked if anybody was home - there was a lock on the gate at the bottom and thankfully Kel obviously wasn't there."
The apartment above Cafe Latte was home to Kelly Tanks, who owns the Coronet Milk Bar and is known to many as the Lolly Lady.
Mr Drage said he didn't spot a fire until about 12.45pm, when flames were seen in one of the apartment windows.
NSW Fire & Rescue acting inspector for the Central West, Dane Philippe, said about 30 firefighters were needed on Monday to control the blaze, and that a crew remained at the scene overnight into Tuesday.
Fire investigators from Sydney arrived in Orange late Tuesday morning, and were working with police forensics to try and establish the cause of the blaze.
"We also have a canine accelerant protection dog up here just in case we need it," said acting inspector Philippe.
He said there was "absolutely no indication" that the blaze was the result of arson.
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