A flagship social enterprise set up to help people with autism gain employment, has gone bust just two years after it opened.

The west of Scotland firm Specialisterne UK was set up to help demonstrate that some of the traits of people with autism can be beneficial, rather than a hindrance in the workplace.

However, a collapse in demand for its services has forced the company to close its doors, making 10 people redundant, five of them people with autism who it had trained as IT consultants.

Yesterday management were stressing its failure was due to the economic climate.

Set up as a subsidiary of Community Enterprise in Strathclyde, dissolving the company will leave its parent owing £350,000 in loan capital to Social Enterprise Scotland, the Scottish Government fund for social businesses. A further £350,000 invested by the fund has been lost.

Meanwhile, the project had been awarded £450,000 by the Big Lottery Fund in Scotland, although it had only drawn down £330,000 of this, and had £30,000 in start-up money from Glasgow City Council.

The firm was based on a model which was created in Denmark and has been successful in a number of other countries including Germany, Iceland and Switzerland. However, early ambitions were dashed – it had been claimed Specialisterne UK would employ 50 people with autism, turning over £1.6m by 2015.

In targeting software data testing, which requires attention to detail and a willingness to engage in repetitive tasks, the company was also moving into an area where Scotland four years ago had a severe skills and capacity shortage.

But sales peaked at £10,000 a month and the company found potential customers and sub-contracting work it had lined up pre-launch were withdrawn or reduced as companies in the sector responded to the financial climate by cutting back.

Specialisterne Scotland's chairman Gerry Higgins said: "Since its inception Specialisterne employees have broken through significant barriers and shown themselves to be a highly skilled and talented workforce.

"This is not a failure of people with autism, and the model has been successful around the world. But adverse trading conditions caused by the economic downturn have resulted in Specialisterne being unable to generate sufficient sales to build a sustainable business."

The decision to close the business comes after three months of intense negotiations to try to transfer the business to another company in the sector, but these were ultimately fruitless.

Mr Higgins said employees of the company had been kept informed throughout. He said: "We are working closely with the employees to help them find suitable alternative employment."

The Big Lottery Fund's grant was for the training of people with autism in key skills and over the last two years 22 people with Autistic Spectrum Disorder and other disabilities have benefited from training.

A spokeswoman said: "BIG's funding was to support the training of people with Autistic Spectrum Disorder and other disabilities and to get them ready for work. In this aspect of the project there is no doubt that the 22 trainees who joined the programme have benefited significantly.

"The barriers for this group in now entering employment have been significantly reduced. Not only do they have an internationally recognised qualification but they also have a greater understanding of the work environment."

The collapse of the company is one of several social businesses this year, including training and employment firm Social Enterprise Clydebank, Erskine Furniture, a company run by the Scottish Veteran's Charity, and with another, Glasgow Furniture Initiative, under threat of administration.