Three Kaikōura businesses may have to close down because of a plan to realign State Highway 1 where it enters the town from the south.
The Transport Agency said the current access was unsafe.
It said 22 properties would be affected by the change, five of them significantly.
Dave Stanford, who owns the Lazy Shag Backpackers, said his property and at least two others would need to be knocked down to make way for the road.
"I've put my life into this business. Every dollar we've made, we've basically reinvested into it," he said.
Mr Stanford said the proposal had added to the stress at a time when business had been badly affected by last November's earthquake.