CLOSE TO half the small businesses that took part in a recent survey said they were either winding up, just surviving or barely hanging on.

Cross-Border body Intertrade Ireland’s third quarter Business Monitor Survey, which covers 1,000 Irish companies, found that most organisations are dealing with falling sales and cash-flow problems.

“Small businesses are still suffering disproportionately from the economic downturn, with nearly half – 46 per cent – of businesses reporting that they are winding up, contracting or simply trying to survive,” Intertrade Ireland said yesterday.

Only 6 per cent of them were planning to increase employment in the near future, the organisation added.

Its director of strategy and policy, Aidan Gough, said that “a decline in customers, a fall in confidence and contraction in cash” were reinforcing each other in a vicious circle that is proving difficult to break.

He added those companies that depended most heavily on the domestic market were more likely to suffer than those with an export business.

“Around 33 per cent of companies which are exporting or involved in cross-Border trade are reporting increased sales, compared with only 19 per cent of those which are operating solely in local markets,” he said. “The road map is very clear – we need more companies exporting.”

The survey found that there is a perception that banks are continuing to squeeze credit, although just 10 per cent of those surveyed actually sought finance from their banks during the third quarter of the year.