Almost one in ten (9%) small to medium-sized businesses (SMEs) have admitted that they could go out of business if trading conditions fail to improve in the coming months, according to a new survey The latest bi-annual SME Pulse report from Aviva found that that confidence among SMEs in 2011 is lower than ever, with only 13% thinking UK economy would see any sign of improvement this year. The report said that this represented a 5% fall since autumn 2010, when 18% of SMEs believed that the economy would start to improve in early 2011. The research found that 37% have found trading conditions tougher than they expected so far this year, while more than one quarter (28%) of SMEs still believe there is a real danger of a double-dip recession. However, over a third (35%) of restaurants have actually found conditions easier than expected in 2011, the highest of any business type, and represents a marked from 21% last year. 28% of SME predicted a difficult summer, with 6% claiming it would determine whether they could continue to do business into the rest of the year. The research also found that firms had taken a number of steps to keep their businesses viable, with almost one quarter of those surveyed reducing prices in the last six months and 20% diversifying their offer. David Bruce, commercial product manager at Aviva, said: “It is evident that the tough trading conditions we saw last year have continued into 2011. Confidence among SMEs is as low as it has been since the onset of the recession and many feel they are in real danger of losing their businesses should the economy fail to improve this year. The recent spate of failures on the high street confirms that the consumer-facing economy is feeling a particular squeeze at the moment as discretionary spending falls. “Looking ahead, there seems to be little change in the tactics that will be employed by small business owners to improve trading – we can expect further discounting, increased efforts to diversify into new product and service lines, and regrettably a reduction in staff numbers.”