Richard Metcalfe, head of public interest entity services for Mazars in Yorkshire and the North East, said that it has been very difficult for firms to get listed on Aim unless they had a market capitalisation of £50m.

Last month a partner at one of the Big Four accountancy firms warned that falling market values meant some smaller plcs in Yorkshire were looking at going private.

Mr Metcalfe also said that many firms were having to rearrange their debt because of more stringent conditions imposed by banks during the credit crunch.

Speaking after a Mazars seminar with flotation consultants Holland Bendelow on getting listed, he said: "Debt facilities are being cut or the re-arrangement fees are much higher. Debt is more expensive."

Over the last year firms working in manufacturing, engineering, technology, telecoms and support services have sought entry to an exchange in order to generate more funds, he added.

"It tends to be these companies which need to raise money whereas retail gets cash from the public in their hands so we
don't see them coming to the market."

Mr Metcalfe, based at the audit, tax and advisory firm's Leeds office, also warned that some firms were suffering from not preparing adequately for flotation.

He said: "There is evidence that those that prepare earlier – 12 months – fare better than those that prepare for less than six months."

Firms that spend 12 to 18 months preparing for flotation have done better and Mr Metcalfe added that firms beginning to consider flotation now could be well positioned to enter Plus should the credit crunch have eased in a year's time.

The value of the YP75 has fallen heavily over the last 12 months and last month Roger Esler, a corporate finance partner at Deloitte, said that substantial share price falls had battered confidence and made it difficult and expensive to raise equity capital.

Yesterday Andrew Emmott, director of corporate finance at investment manager Brewin Dolphin, said he expected Plus to expand because it offered a simpler way for firms to go public.

"It is going to increase its market share in terms of trading values. It is a little more straightforward than Aim.

"There is a place for very small companies which want to raise money publicly."

However Mr Emmott said he was not yet aware of a large number of companies choosing Plus and said many used Aim.


Low-cost rung on the listing ladder

Small cap shares are traded on the Plus market, which until 2006 was known as Ofex.

Listed firms are often making their first foray on to the markets and many consider it a rung on the ladder to a listing on the more prestigious Aim.

The lower cost of listing on Plus – typically about £250,000 for a company raising £5m – has attracted more small companies and now Plus generates about two-thirds of its income from listing fees.

More than 600 small and mid-caps do the majority of their trading on Plus.