In 1792 a committee of businessmen commissioned Benjamin Outram to survey and estimate for a broad canal to run from Swarkestone to Denby in the Bottle Brook Valley north of Derby, with a branch to Sandiacre on the Erewash Canal. A branch to the Trent at Swarkestone was also included. In the event the high cost of crossing the Derwent in Derby and the steeply graded Denby line resulted in a tramroad being built from Little Eaton to the Denby collieries. It was, at the time, proposed to build a canal parallel with the Trent but his was dropped as Jessop, who had been consulted by Outram, believed the Trent adequate and few boats would use the canal.
The Derby Canal was first advocated by James Brindley in 1771 as the transport system in the town was poor, the roads were inadequate and the river Derwent was prone to flooding; downstream traffic was also slowed by delays on the Trent. Coal in particular was expensive in Derby despite the proximity of mines in the nearby Bottle Brook Valley, which were un-developed and unprofitable due to a lack of suitable transport.
It was first proposed to link the Trent & Mersey and Chesterfield canals via Derby but vested interests scuppered this until 1791 when proposals were made for a Swarkestone to Nottingham canal with a branch to Derby from either Swarkestone or Shardlow.