Bosses at Flowfit have been in discussions with the authority about expanding to a nearby site in the town since the start of the year, but said after months of negotiation, they are yet to receive a "valid response".
Simon Parsonage, the firm's chief executive, said the company, which is based on Ludlow Business Park and celebrates its 25th anniversary in June, is now looking to move to a site in Wales.
In response, Shropshire Council said it had been seeking specialist advice and that the process was "complex".
The authority added it hoped there would be a "swift resolution" following the most recent talks with the firm.
Mr Parsonage said: "I run a successful company – a company that needs to expand – and like all companies we have welcomed the advice and support that comes from bodies such as the Local Enterprise Partnership and local councils.
“We are desperate to expand and our preferred option is to find an additional site near to our current premises on Parys Road.
“But when it comes to the everyday practicalities of doing business, Shropshire Council seems at times to be in a state of paralysis.
“I am totally frustrated that after three months of trying to get help from Shropshire Council, all I have received is emails that say no more than 'we’ll get back to you'.
“If I can’t find a site in Ludlow quickly, we will expand in Wales which seems to have a more business-friendly environment.”
Matt Potts, business growth and inward investment manager at Shropshire Council, said: “This has been a complex process and we have been seeking specialist advice from an external source before we were able to progress.
"We have spoken to Flowfit on Tuesday and hope there can be a swift resolution. We are always here to support Shropshire businesses and help them thrive.”
Shropshire Councillor Andy Boddington, who represents Ludlow North, said he was "shocked" a vacant site had not yet been found.
"Businesses don’t need talk. They don’t need policies lost in filing cabinets. They need action,” he said.