A Molong gelato factory will close at the end of the month, despite receiving hundreds of dollars in financial grants.
According to the Central Western Daily, an employee of Gelato Ingredients Manufacturers of Australia confirmed the factory, in central NSW's Molong, will soon be shutting up shop.
The company's woes are despite significant assistance being handed down by the local council.
In 2007 Cabonne Council bought the land for the factory and the federal government gave Gelato Ingredients Manufacturers of Australia $163,000 in funding, aimed at assisting rural gourmet food producers.
Bruce Buchanan, executive officer at Business Enterprise Centre (BEC), which puts businesses in touch with government authorities in order to secure grants, said the gelato factory's demise shouldn't be reason to cut financial assistance for other rural brands.
"The idea behind the funding is to make it attractive to businesses to want to relocate to smaller towns and cities," he said.
Buchanan said a number of other companies in rural areas like Orange are struggling.
"You look down the main street of Orange and there are vacant retail shops, it is just the economic climate," he said.