"I was about to walk in -- it would appear a male had taken one of the cashiers hostage with a machete, and he apparently had it at her throat. I have no idea what his demands were, except one that he wanted to speak to a female police officer," Mr Baker said. "I have no idea what his motivation was.
"Bob, the manager, was being very diligent in getting everyone out. Two police officers were on the scene pretty quickly, as the police station is about two doors down."
Mr Baker believed the alleged offender was a local who had only recently moved into the area.
Alex Wehweck, manager of Boots Off internet Cafe, four shops away from Four Square, said he and two customers saw Mr Patel ushering people away from the store before police evacuated the area.
"It was a dumb arse obviously because you do not rob a supermarket 20 metres from the police station," Mr Wehweck said.
Paihia was very busy with tourists at this time of year, he said. "This is something that [takes] a while to get over".
He said he thought police handled the situation well. "To be perfectly honest they were quite calm."
Police said officers managed to enter the shop and speak with the man, who eventually put down the knife and surrendered to the officers.
Inspector Wendy Robilliard, Far North Police area commander, praised police officers, saying their negotiation skills helped to resolve the matter quickly.
Mr Patel was with police earlier this afternoon, believed to be giving a statement but the shop had reopened after the incident.
"It's all good," a Four Square employee said. "Everything is over and back to normal. The shop is open for business."
The Whangarei-based Armed Offenders Squad were also called to the scene but were stood down en route.
A 40-year-old man has been charged with kidnapping and with wounding with reckless disregard, One News reported.
- Additional reporting the New Zealand Herald and the Northern Advocate
