Countdown in Waihi will close down next month because the building has been deemed unsafe - costing 41 people their jobs.
Staff were informed of the closure at a staff meeting on Wednesday.
Countdown's national trading manager Ryan McMullen said the decision was made because of the level of repairs and maintenance required on the site and the building.
"The advice we've been given is that the supermarket and the site will need to be extensively repaired or redeveloped, and sadly it just isn't sustainable for us to stay here.
"The foundations and floor have moved, which will deteriorate further over time," he said.
Mr McMullen said management was looking at options to provide employment for staff but the company did not plan to open another store in the town.
"We will be doing what we can to provide ongoing employment for our people in our Paeroa and Katikati stores, or within the wider Countdown store network," Mr McMullen said.
"Despite our best efforts, we haven't been able to find an alternative option for a Countdown supermarket in Waihi."
Of the staff, a quarter worked at the store fulltime with the rest part time.
"[The closure] is in no way a reflection on the efforts of our Waihi team and the hard work they put in every day to serve our customers," Mr McMullen said.
Waihi resident Thaleya Gainfort said she was saddened by the news.
"That's a shock and really sad for Waihi - a huge loss. I really feel for all the staff. Waihi has had losses like this before, and worse, and we've always bounced back. I know it's not much consolation for the people losing their jobs at the moment but 'one door closes, another one opens' - usually for the better," she said.
Locals will still be able to shop online or drive to their nearest Countdown supermarkets in Katikati or Paeroa.
The store will see its final day on May 28.