The German supermarket chain has applied to build a large store at 5 Innovation Way, Kennington, adjacent to Strath Village.

Traders at Strath Village have mixed opinions about what the supermarket could mean for the centre.

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Love a Lattee business owner Tim Carnell said the proposed Kaufland supermarket would be detrimental to Strath Village.

"It's going to take people away from here. I know it's just up the hill there, but I honestly think it will take people away," Mr Carnell said.

"We're pretty proactive in what we do here. We do themed nights, we do high teas, all to help boost our business over and above what we would do normally, but that's only going to go so far."

Mr Carnell said the closure of the Supa IGA on Thursday night had affected business, and would continue to until the store re-opened.

But he said Love a Lattee had been holding its own, with customers coming back regularly.

In contrast, Strath Mensland business owner Katrina Byleveld said a Kaufland would be more competition for Aldi rather than Strath Village.

"The people who come into the centre want to shop local, and they want to support local products," she said.

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City of Greater Bendigo manager of statutory planning Ross Douglas said the move to an state-based independent advisory panel meant the planning application was out of the city's hands.

The Minister for Planning can appoint an advisory committee to consider specific planning policies.

Kaufland applied to the Minister for help to facilitate its first wave of proposed stores.

Mr Douglas said he assumed Kaufland chose to use the state-based process in the hope it would be speedier than going through the politics of local government.

He said it was the first time the method had been used in Bendigo, but it had been used for other Kaufland supermarkets across the state.

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Mr Douglas said the independent advisory committee would consider the same issues as council when evaluating a planning application.

Economic impacts, built form, signage, stormwater management and hours of use were among the issues considered in a report from the advisory committee into Kaufland stores in Melbourne published in February.

Mr Douglas said the council would write a submission to the independent advisory committee, but had not yet seen full plans for the proposal.

The independent advisory committee has released its report into five Kaufland supermarkets in Melbourne to date.

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