Dissertation Proposal: Problems of Canadian Small Business Finance

This dissertation proposal investigates the financial challenges faced by small businesses in Canada when seeking financial assistance from Canadian banks. The research aims to identify the major issues and challenges, evaluate potential solutions, assess the impacts of these issues, and recommend measures to overcome them. The proposal includes a review of existing literature, covering financial problems, issues with Canadian banks, and potential solutions. The methodology section outlines participant selection, data collection methods (interviews and surveys), and data analysis techniques. The study also considers the trustworthiness of the chosen methods. The proposal concludes with recommendations, a timeline, and references. The study emphasizes the importance of addressing financial issues to support the growth and sustainability of small businesses in Canada. The research questions focus on identifying the major issues, evaluating approaches to overcome them, assessing the impacts, and recommending measures to help small businesses overcome these challenges. The research is justified by its potential to benefit both small businesses and the broader industry by providing insights and solutions to financial obstacles. The proposal also highlights the importance of proper planning, financial management, and the role of government and financial institutions in supporting small businesses.

Running head: DISSERTATION PROPOSAL
Dissertation proposal
Name of student
Name of University
Author note

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DISSERTATION PROPOSAL
Table of Contents
Introduction................................................................................................................................3
Research aim..........................................................................................................................3
Research objectives................................................................................................................3
Research questions.................................................................................................................4
Review of the Literature.............................................................................................................5
Financial problems faced by small businesses.......................................................................5
Issues and challenges faced by small firms when seeking financial assistance from
Canadian banks.......................................................................................................................6
Solutions to the issues and problems faced while undertaking financial assistance..............8
Methodology..............................................................................................................................9
Participants...........................................................................................................................10
Role of the researcher...........................................................................................................10
Data collection......................................................................................................................11
Data analysis.........................................................................................................................11
Trustworthiness of the method.............................................................................................12
Analysis of data and information.............................................................................................12
Conclusions and Recommendations........................................................................................13
Recommendations................................................................................................................15
Timeline................................................................................................................................15
References................................................................................................................................16

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DISSERTATION PROPOSAL
Small Businesses in Canada face problems while undertaking financial assistance from
Canadians banks
Introduction
The research proposal is prepared to discuss about the various problems that are faced
by the small business organisations in Canada while undertaking financial assistance from the
banks of Canada. It has been found that small business when aiming to fill a market niche,
the required amount of finance is difficult to obtain and also it can affect the ability carry out
a project effectively. Though the Canadian banks have provided financial assistance by
providing loans to the companies, still there can be uncertainties and poor credit scoring by
the small companies, which also affects the ability to sustain in the competitive business
environment (Fraser, Bhaumik and Wright 2015).
There are sufficient resources including scopes for conducting interviews with the
managers and even distribute survey questionnaires, based on which, the data and
information can be obtained easily. The secondary sources of data can be obtained from
various journals, articles, newspapers and websites containing information about the topic of
research (Goodhart et al. 2013). This can ensure proper consent of the organisation and even
allow for gaining access to accurate data and information that can be obtained from various
authentic data sources, which will represent the validity and reliability of the research too.
Research aim
The aim of the research is to highlight the major issues and challenges that are faced
by the small business organisations while taking financial help from the Canadian banks
Research objectives
 To identify the major issues associated with the small business functioning while
taking financial assistance from the banks in Canada

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DISSERTATION PROPOSAL
 To evaluate various approaches by which these challenges can be dealt with to gain a
good financial condition
 To assess the probable impacts of these issues that arise while undertaking financial
assistance from these Canadian banks
 To recommend necessary measures for making sure that the issues emerged during
financial assistance from the banks in Canada are overcome
Research questions
What are the major issues that may be faced by the small businesses while undertaking
financial assistance from the Canadian banks?
How can the various approaches undertaken by the small businesses help in overcoming the
issues during financial assistance?
What are the impacts created by the issues and challenges faced while taking financial
assistance?
What suitable measures are recommended for making sure that the small businesses do not
face further issues while gaining financial help from the banks in Canada?
The topic is being researched because of the potential benefits that can be obtained by
both the small business and even the entire industry. The topic has been chosen as it will
allow for identifying various issues that can emerge while undertaking financial assistance in
the form of gaining loans, financial advices from the Canadian banks. The banks though
provide financial support to the large businesses with the aim of gaining huge amount of
profit and interest as well while for the small businesses, due to the limited size of operations,
the Canadian banks are left out from obtaining good amount of money, which further affects
the growth and prosperity (Millar, R. and Hall 2013). The research will shed light on the
various issues associated with the management of financial help from these banks,

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DISSERTATION PROPOSAL
furthermore enable precautionary measures for overcoming the issues with ease and
effectiveness. Based on the valuable insights, it will also be helpful for undertaking actions
that can allow the small businesses to prosper though without any issues faced while taking
financial help from the banks in Canada.
The justification of the research topic is according to the main objective of knowledge
acquisition and for the purpose of developing solutions needed to overcome the financial
issues that may be faced by the small businesses while taking help from the Canadian banks
(Bruton et al. 2015). Amidst the financial issues faced by the small businesses, it is important
to consider the major components required to facilitate contribution to the research related
aspects, furthermore, make significant changes and adjustments for improving the strategic
plan and efficiency to meet the financial requirements of the small businesses that are willing
to take help from the Canadian banks to survive in the competitive business environment
(Mason and Brown 2013).
Review of the Literature
Financial problems faced by small businesses
According to Teo and Cheong (1994), most of the small business organisations start
with a promise and in case the manager or leader of the organisation has a sound vision and
mission, then the tasks become easier, which promotes innovation and proper project
management too. To ensure management of good amount of working capital and enough
financial resources, the small businesses need to secure the initial funding and at the same
time, manage roper planning to prevent unexpected expenditures, furthermore ensure
preventing any delays that might be encountered while managing the business (Teo and
Cheong 1994).

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As stated by Howarth and Quaglia (2013), the major issues faced by the small
businesses while aiming to gain growth or expand have been difficulty in securing the initial
funding and it could be related to the undercapitalisation. Juts implementing an idea might
not be effective enough to gain success and this could also make them run out of funds. The
lack of proper planning could create difficulties for the small business to assess the start-up
costs, costs of operations, tax, expenditures for emergency situations, etc. Goodhart et al.
(2013) also argued that there are multiple other issues such as the unexpected expenditures
that are not considered, could result in various complexities while paying the bills and make
payroll. The small businesses could not afford the high amount of wages and other benefits to
be provided to the employees, which further could result in financial stress and negatively
affect the performances of employees (Levenson and Willard 2000).
Issues and challenges faced by small firms when seeking financial assistance from
Canadian banks
As stated by Barringer (2015), to deal with financial issues, manage proper budgeting
activities and ensure maintenance of good financial condition, the small businesses often
have wanted financial support and assistance from the Canadian banks. The financial aspects
are considered as the life line of small businesses and thus the equity finance and debt are
considered as major sources finance used by the company. The lack of credit scoring is
another major issue that small businesses often neglect and this results in uncertainties that
make the Canadian banks request the clients to deliver an appropriate credit scoring based on
the decisions made to control exposure (Lee, Sameen and Cowling 2015).
Gbandi and Amissah (2014) also stated that the Canadian banks often are not
interested to enhance the credit facility without making any proper assumption of the
collateral increment from the perspective of the small businesses, which might not be willing
to make any increment thereafter. There are issues such as maturity gap, which have emerged

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due to the difference between the small businesses and the Canadian banks in terms of the
assets and liabilities’ maturity. Due to this, the small businesses faced problems and issues to
acquire short and medium term loans, thereby resulted in pursuing the loans that were not
secured with mortgages against the property. As the Canadian banks seeks good rates of
return for the loans granted, these financial institutions often set higher rate of interest to gain
personal guarantee from the small business owners while the rate of interest is much lower
for the large businesses (Hillary 2017). The stock market might not also have good
confidence on the small businesses, which could also result in lesser value creation along
with various issues and complexities related to the acqusitions of equity finance.
According to Teo and Cheong (1994), based on survey processes, most of the people
believed the fact that the lack of financing options has been one of the major issues that had
been faced by the small businesses in Canada. The multiple issues experienced are diverse
and include those aspects that combine to form the financial management and condition of
the small businesses. The studies showed that the financial issues were mainly faced by the
small businesses while acquiring bank financing and also during the period of recession. To
alleviate the solutions and ensure dealing with these kinds of issues properly, the Government
has introduced new loan guarantee schemes, which eased down the situation and at the same
time, could ensure creation of more opportunities for the small businesses to get financial
assistance properly. Quarter, Mook and Armstrong (2017) also argued the fact that the main
issues that have resulted from getting financial assistance from the Canadian banks also
included the poor amount of collateral, lack of keeping good track records and also poor rate
of return provided to the banks by the small businesses when compared to the large business
organisations. As stated by Beyhaghi, D’Souza and Roberts (2014), the small businesses face
other problems too such as the higher rate of interest, bank charges, slow payment, poor
financing, etc. The Canadian banks often treat the businesses differently based on the sizes,

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DISSERTATION PROPOSAL
because of the good rate of return that can be gained from the large businesses, which is
much more when compared to the smaller businesses. These issues arise from the poor
services, strict payment terms and conditions from the suppliers along with high pressure on
prices along with slower payment made by the customers.
Solutions to the issues and problems faced while undertaking financial assistance
To make a small business function properly, there are various obligations and
concerns associated with the financial issues and problems faced while undertaking financial
assistance from the Canadian banks. The major reasons include lack of capitalisation or
insufficient capital and other issues related to the business financing. The Small Business
Association or SBA enables identifying and assessing various factors associated with the
emergence of financial issues along with focus on poor capital structure, overspending, lack
of reserve funding, etc. According to Lusztig and Schwab (2014), the SBA could provide
assistance and help in the form of financial advices to the owners of small businesses,
furthermore prepare strategic plans for managing the small business easily and at the same
time, take advantage of the resources, both financial and human resources for meeting the
requirements of the small and medium sized businesses.
On the contrary, Brown and Olender (2013) suggested that the addressing of financial
issues has been beneficial for reviewing, assessment, revamping and for the purpose of
conducting research before the development of business plan for the small sized businesses
while taking financial assistance from the banks in Canada. In case the expenses made by the
company and business plan are not up to the mark, then the small businesses need to
implement some major changes, furthermore allow the owners of the businesses to seek loans
with much ease and also the grants that have been designed for providing the businesses a
greater boost. The small business owners could also take part in training seminars and
developmental sessions for providing better financial assistance while the angel investors and

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DISSERTATION PROPOSAL
venture capitalists are provided with the roles and responsibilities of taking risks and provide
funding support to the small business owners for maintaining consistency in the continuity of
business operations and processes, which are vital for improving the reliability and viability
of the business plan prepared to overcome the financial issues experienced while undertaking
financial assistance from the banks in Canada (Teo and Cheong 1994). It has also been found
that the banks of Canada are generally inclined towards the large sized businesses because of
the large amount of profit that can be derived along with the higher gain of interest.
Gaps in literature
The major gaps in literature are the lack of authenticated articles, which sometimes
contained wrong information and data that might hinder the successful management of
research. The research mainly focused on the specific issues faced by the small businesses
while undertaking financial assistance from the Canadian banks and so no other banks were
being considered here, which could also prevent information acqusitions related to the
financial performance evaluation of other banks. There were few websites and documents
that did not contain relevant information that could be appropriate and authentic and thus no
research work had been done in this area. Therefore, this could be the research gap
experienced in the literature section of the research.
Contribution to research
By doing the literature review in this part of the research, various secondary sources
have been assessed, which assisted in gathering immense knowledge and information about
the research topic. This would not only contribute to the research, but could even facilitate
the understanding of business management along with assisting the researcher to attain new
heights of success in terms of personal and professional growth all throughout. This is how

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DISSERTATION PROPOSAL
the literature review of the research could assist in contributing to the research fruitfully and
derive positive outcomes as well.
Methodology
Considering the focus of the dissertation proposal, there are various perceptions and
experiences associated with the top management of small businesses that have been subjected
to risks and financial issues associated with the financial help and support taken from the
Canadian banks. The methodology is based on qualitative data and information and thus
various aspects have been considered including the engagement of employees, social support,
relations among the employees along with the other factors associated with the qualitative
research data and information. All these various facts, information and data are based on the
human observations, analysis and interpretation of data and information, which should assist
the researcher to conduct the research and analyse the data and information effectively too
(2016). Thus, it is clear that the qualitative methodology would be used here for the purpose
of collection and analysis of data and information and ensure deriving appropriate outcomes
all throughout the research.
Participants
The sampling technique include both probability and non-probability sampling
techniques. The participants are selected randomly, especially the respondents while because
of the qualitative research methodology, the data and information would be fetched in the
form of responses and opinions of the managers who are considered as part of the interview
session while conducting the research. The individual interview method has been fruitful
considering the fact that on the basis of non-probability convenient sampling method, the
managers are engaged during the interview session, which further allow for acquiring
relevant responses and opinions, considered as qualitative data while conducting the research
and while collecting data and information effectively (Taylor, Bogdan and DeVault 2015).

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DISSERTATION PROPOSAL
Role of the researcher
The researcher do hold the roles and responsibilities of conducting the research and
even influencing the participants of the research to provide data and information in the form
of their responses and opinions. The research should also check the reliability and
authenticity of the data sources, based on which, the data and information would be obtained,
which could allow deriving positive outcomes and at the same time, facilitate the ability of
researcher to conduct the research much more effectively. The researcher should not only
conduct the interview with the researcher but would also identify the secondary sources of
data including various journals, articles, documents and newspapers from which, the data and
information could be derived properly. The researcher should also maintain the values and
ethics of research by making the respondents acknowledged with the purpose of research and
also do not force anyone to take part in the research (Palinkas et al. 2015). The research
materials and resources must be kept secure and safe from any kinds of unauthorised access
and must be destroyed as well after usage, so that it does not fall in wrong hands, which could
result in data replication and copyright of research related data and information, furthermore
affect the authenticity of research.
Data collection
The collection of data include gathering qualitative data and information, which
would be possible with the help of conducting interviews with the managers of the small
businesses that seeked financial assistance from the Canadian banks. The secondary data and
information would be collected by assessing the secondary data sources including the books,
journals, articles, newspapers and documents that contained information about the research
topic. The researcher must make sure to structure the questions in such a manner that the
managers could answer those without any kind of biasness (Anyan 2013). It is also important
to be noted that none of the participants are forced and interviews must be fixed according to

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DISSERTATION PROPOSAL
their convenient schedule or time. The data and information should be gathered and then
analysed for interpretation of results in an appropriate way too.
Data analysis
The analysis of data and information would be done with the help of SPSS tool, which
should also present the data and information in the form of tables and graphs for easily
understandable by the researcher. This kind of statistical tool should be beneficial for
representing the data and information in graphical tables and formats, but would also create
ease for the researcher to present the findings and derive good outcomes all throughout
(Noble and Smith 2015). The qualitative data should be gathered by conducting interviews
with the managers of the banks and also the small business owners based on their convenient
time with the help of non-probability convenient sampling procedure. The researcher would
be able to select a suitable time when the managers could make time out from their busy
schedule and ensure providing their responses, to be considered as qualitative data in the
research. The two managers would be interviewed along with 3 employees, who would be
responsible for providing their opinions and responses, considered as qualitative data in the
research. The analysis of qualitative data could also be done with the presentation of
transcripts and also by presenting the responses of managers in question answer format for
easy understanding.
Trustworthiness of the method
There could be issues and problems related to the reliability and validity of the
research due to the lack of authenticity and genuineness of data and information sources. To
ensure maintenance of validity and reliability of research, the secondary data sources must be
authentic and genuine from which, data and information should be collected. This could also
help to ensure that none of the data and information are derived from unauthenticated sources
and the measurements are generalised. The reliability of research is based on the coefficient

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DISSERTATION PROPOSAL
based on the test results and measurements, which could be possible with the use of
Cronbach’s alpha, Pearson’s correlation, etc.
Analysis of data and information
The data and information considering the qualitative research are to be analysed with
the help of content analysis and also based on the descriptive and interpretative procedures.
The narrative analysis is based on the formulation of stories based on the experiences of the
managers presented in the form of responses and opinions to the questions asked during the
interview session (Alvi 2016).
Qualitative research
questions
Answers provided Vital keywords
Do you think that Canadian
banks do expect good rate of
return because of which,
they are more inclined
towards the large sized
businesses rather than the
small businesses?
Yes, definitely, because the
large businesses provide
better returns for the
financial assistance provided
by the banks in Canada.
Canadian banks, large
businesses, etc.

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DISSERTATION PROPOSAL
Can the financial assistance
undertaken from the
Canadian banks improved
the functioning and overall
ability to sustain in the
competitive business
environment for the small
businesses?
Yes, the financial assistance
should improve the working
capital and enhance the
business functioning,
thereby improve the
business performance
largely too
Working capital, sustained
competitive advantage,
business performance.
What are the major financial
issues that are faced by the
small businesses while
undertaking financial
assistance from the
Canadian banks?
The major financial issues
include poor accessibility to
the funds, unexpected
expenses, etc.
Financial issues, assistance
from Canadian banks, lack
of working capital.
Conclusions and Recommendations
The entire research study was based on the various implications related to the topic of
various issues faced by the small businesses while undertaking financial assistance from the
Canadian banks. The major issues experienced were lack of sufficient working capital, which
might lead to inappropriate business plans and further deteriorate the business functioning as
well. Basically, the research shed light on the major issues associated with the financial help
obtained from the Canadian banks and how the major issues must be dealt with. The
objectives were to identify the major issues that were faced while undertaking financial
assistance from the banks in Canada and also through evaluation of the probable impacts that
might be created. The literature review section included information about the various issues

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DISSERTATION PROPOSAL
as well as the solutions that could enable managing proper flow of cash, furthermore reduce
the chances of risks associated with the fanning from the Canadian banks with much ease and
efficiency.
There were cases and situations when the small businesses that lacked sufficient
collateral failed to obtain proper amount of finance from the banks. Based on the literature
and analysis of data and information, different kinds of techniques for conserving the cash
must be done such as with the help of asset turnover techniques and with the management of
cash flow, which could help in identifying the chances of entering into the venture capital
agreements, furthermore ensure maintenance of track records for the banks during the time
when here is not much need of cash. The research methodology was based on qualitative data
and thus no statistical data and information were presented, rather the responses and opinions
of the managers during the interview session and secondary sources of data were acquired to
constitute the qualitative data.
Considering the amount of data and information gathered during the research, there
had been innumerable issues and problems associated with the financial assistance taken from
the Canadian banks by the small businesses. These problems could not only hinder the
growth and development of the businesses, but would also result in failing to achieve the
desired level of profit and competitive advantage in business as well. The Government and
regulatory bodies must implement information assistance schemes for making those popular
and easily accessible to the small businesses, furthermore prepare business and financial
plans required to encourage and facilitate business entrepreneurship. This would also allow
for improving the small businesses’ ability to gain access to bank financing with much ease
and effectiveness. Lending money to the small businesses should be based on various
marketing methods and techniques, furthermore encourage the financial institutions to make
investments and set up a special loan unit too for providing assistance whenever necessary.

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Recommendations
 Considering the fact that most small and medium sized enterprises find it difficult to
maintain a good cash flow position due to the poor financial assistance provided by
the Canadian banks, it is recommended to enable factoring to manage the accounts
receivable and ensure increase in financing along with growth in sales too.
 The enforcement of Credit Reporting Act is recommended as well for managing the
activities properly related to the reference bureaux, furthermore, should assist in
overcoming the issues and difficulties that might be faced while gaining help or
financial support from the banks of Canada
 The use of credit information and information capital is recommended as well for the
development of information capital and also remove the constraints related to the
gaining of access to credit facilities for the small sized businesses.
Milestone Description Due date Status
1 Stage 1: Identification of the areas of
interest
completed
2 Stage 2: Selection of topic “issues
experienced by small businesses
undertaking financial assistance from
Canadian banks”
completed
3 Stage 3: Aiming to develop the
dissertation proposal
completed
4 Stage 4: Submitting the proposal June 2019 completed
5 Stage 5: Data collection process July 2019
6 Stage 6: Data analysis and
interpretation
Aug 2019
7 Stage 7: Write up or documentation Oct 2019
8 Stage 8: Final draft prepared and
submission of the draft
Nov 2019

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DISSERTATION PROPOSAL
9 Final deadline set December
2019
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