Police believe the fire at Cotton On, Launceston, was deliberately lit.
The fire, which occurred about 5.15pm on Wednesday, was extinguished by the inbuilt sprinkler system and staff members.
Police said initial investigations suggested clothing was set alight at the front of the building.
Anyone with information is asked to contact police on 131 444 or Crime Stoppers anonymously on 1800 333 000.
EARLIER:
Building occupants rushed to evacuate a busy multi-storey building on St John Street shortly after a fire broke out on the ground floor about 5pm.
The fire that started in the street's Cotton On store drew four fire trucks, police and an ambulance to the scene as fire crews worked to get on top of the plumes of smoke engulfing the shop.
Tasmania Fire Service Developing Leading firefighter Nic Rowbottom said investigations were ongoing and it was too early to say whether the fire was deliberate or not.
He said the TFS would look at conducting an investigation with Tasmania Police once smoke had been ventilated form the store.
A nearby shop employee, who chose not to be named, was working across the road from the store when she noticed "smoke was billowing out" of the Cotton On front doors.
She said shortly after seeing the smoke call-centre employees working on the second floor of the building came running out trying to avoid the smoke. Later, she said, employees of Cotton on fled.
Two of the workers appeared to be clearly affected by the smoke, and one was treated by fire and ambulance crews.
The nearby employee said two police officers happened to chance upon the fire while walking the street before alerting the TFS. A police spokesperson confirmed the fire was initially called in by police.
Mr Rowbottom said one of the employees was put into an ambulance and was due to be transported to hospital as a precaution.
He said by the time fire crews arrived the sprinkler system in the building had extinguished the fire with only smoke remaining.
With investigations due to continue into the night, it was not known exactly how the fire started or how much damage it had caused.
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