Fears of a second COVID-19 wave have dampened patronage at NSW venues, with one saying the situation is "dire".

An on-duty Liquor and Gaming NSW COVID inspector has reported a “significant” drop in patron numbers across licensed venues since the Crossroads Hotel outbreak in NSW.

“After Crossroads, and then the restaurant at Potts Point, no one wants to go out,” the inspector told The Daily Telegraph.

“Potts Point hit home for everyone. Since then, it has been a lot quieter.

“A lot of venues are also closing earlier. No late night crowds so they’re not staying open.”

Nine News also reports there was a significant drop in pub patrons over the weekend in Sydney, with many venues closing early.

Regulations for NSW venues were further increased by Premier Gladys Berejiklian on July 17 following the outbreak at the Crossroads Hotel (pictured main).

Under the tightened rules for NSW venues, all patrons must remain seated, bookings are capped at 10 people and venues must have no more than 300 people at any one time.

The Crossroads Hotel has since reopened after a deep cleaning and is officially registered as a COVID Safe business with the NSW Government.

It noted on Facebook: "We would like to thank everyone for the support that has been shown by our community of loyal customers during this difficult period and we look forward to welcoming you back."

Ellen McDermott, the owner of Leichhardt wine bar and restaurant Creek and Cella begged the venue's "Facebook family" over the weekend to make bookings.

"Its Saturday night and we have no customers," she wrote: "We’ve sent our chef home with the possibility of no shifts next week! He is Colombian student ... no jobkeeper, no job seeker ... no income."

McDermott told news.com.au: “We’re stuck in this limbo that we’re allowed to be open but no one is coming out or doing anything.

“It’s been dire. We’re not even making enough money to pay the rent."

COVID fine for Watsons Bay Hotel

The Watsons Bay Boutique Hotel in Sydney's eastern suburbs has been fined $5000 for multiple breaches, including failing to follow its own COVID-19 Safety Plan.

It's the 15th fine issued to a venue in NSW in the past three weeks.

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On Friday night, undercover inspectors from Liquor and Gaming NSW visited found numerous groups of patrons standing around drinking alcohol, as well as separate groups sitting at tables within 1.5 metres of each other.

All poker machines were open for use, without there being 1.5 metres between each machine – in breach of the hotel's COVID Safety Plan, which states that every second machine is to be switched off.

Liquor & Gaming NSW Director of Compliance, Dimitri Argeres, said: "Flouting these measures is not only bad for the health and safety of patrons; it's also bad for business.

"This latest penalty serves as a reminder to all hospitality businesses that the chances of being caught for non-compliance are high."

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