The Scorpions upset defending champion Manukau South in straight sets in last week's semifinal.
But Tauranga proved too strong in the final, winning 25-21, 25-11 and 25-16.
The match was not as evenly contested as Malcolm had hoped.
"It wasn't close," she said.
"They were very good but we are certainly capable of a lot more than we demonstrated."
The Scorpions suffered an earlier loss to Tauranga but the team was buoyed following its comprehensive win against Manakau.
The Aucklanders entered the tournament unbeaten for the season but were ambushed by the determined Scorpions.
While that was a fantastic effort, the memory of the lopsided final was still fresh in the mind.
"I guess I'm pleased we got as far as we did but it is certainly disappointing to know we are capable of a lot more and did not really bring it on the day."
Personally, it has been a very successful season for the 32-year-old mother of one.
Malcolm, who plays in the libero position, has played beach volleyball for New Zealand but after 10 years of toiling away at club and provincial level, finally made it into the national indoor volleyball team this year.
She joined Scorpions team-mate Debbie Hill in the New Zealand team which placed third at the Oceania championships in New Caledonia in July.
Hill was in dominant form for the Scorpions and was named the top spiker at the tournament.
Former New Zealand player Claire McPherson also performed well.
Hill is a double representative and will be in action for the Otago netball team this weekend when it opens its national championship campaign against Wellington in Porirua on Saturday.
Scorpions coach Jock Murley said volleyball was in good health, particularly at school level, but like a lot of sports, participation levels fell away once people left school.
"At school level it is very good," Murley said.
"There are 50-60 school teams playing on Monday and Friday nights. At club level, because of the way it is organised, it is more difficult.
"There is a fairly healthy social competition taking place on Monday nights and Tuesday nights around the town. But because of the number of players who are at university playing club volleyball, it's a bit restricted."
There are two Dunedin clubs and they compete in a southern league with four teams from Christchurch.
A Blenhiem-based team is expected to enter the league next season.
But, ideally, Murley would like to see a Dunedin club competition established.
"We are working towards that but we are very conscious of the fact that we have a limited number of people who can do that and who can run it. The people involved are heavily committed in school volleyball.
"At school level volleyball, it is significantly bigger [than people think]. The Maadi Cup rowing competition is fairly big but the volleyball national competition is one of the very biggest tournaments in terms of the number of kids participating."
