Shopping has become a key part of our social, cultural and economic fabric, providing millions with enjoyment, entertainment and employment. But delivering successful retailing is not easy.

The rise of online shopping and the growing desire for spectacle and entertainment to be part of the shopping experience are examples of this rapidly changing world. At the same time, it is important to understand — and effectively control — the various risks that can undermine the success of retailing.

There are many things that can and do go wrong that can have a serious impact on profits and the consumer experience.

For the first time, the nature and extent of these retail risks have been measured across the GCC countries. My survey on “retail loss” done in association with Jard Inventory & Loss Prevention Solutions offers information that can help its retailers better understand the risks that they face, and the common approaches being adopted to try and manage them. Here are a few:

• Average losses were in the region of 1.7 per cent of retail sales, which equates to approximately Dh14 billion a year.

• Respondents thought that process and administrative errors were the biggest causes of these losses — theft was not seen to be a major issue by most.

• While expenditure on managing loss prevention was higher than found in other regions, the level of losses were also above those found in Europe and the US.

• Awareness of the problem of loss was not high among senior managers.

• A large proportion of respondents are not able to measure their losses accurately.

• Future priorities were focused upon improving staff training and developing better audit and process management systems.

Comparing different parts of the world concerning risk and the way in which retail companies experience losses is not easy. But there are at least three interesting conclusions that can be drawn from this first survey of the retail industry in the GCC.

First, retail is experiencing a challenging time — sales are stagnant or declining and consumers are becoming much more demanding about how and where they undertake their shopping. Innovation and change is critical to remaining successful.

Organisations need to rapidly adapt to the change, where the consumer will be just as likely to shop from the comfort of their home as they are at the mall. This rapidly evolving world will generate new opportunities, but also new risks as well and businesses need to be prepared to identify, measure and manage them more effectively.

Secondly, the survey is clear in showing that the main driver of losses in the region is inefficient processes and arcane business practices. In one respect, this is good news for retailers — for other parts of the world the biggest challenge is external theft and organised crime, which are much more difficult challenges to solve.

Losses that occur through bad processes and other organisational inefficiencies are at least within the active control of the business. They are much easier to fix and control than problems which are external to the organisation.

Thirdly, awareness of the problem seems to be low among senior retail executives in the region. This is understandable.

When retail sales are booming, any losses that occur can be easily offset and therefore may not be perceived to present much of a financial burden, especially if they are calculated in ways that further minimise their apparent scale.

However, when the retail environment becomes much more challenging and profits become squeezed, then these losses can become much more of an issue, particularly if companies begin to adopt new ways of measuring losses which now capture all forms of loss across their business.

In many respects, loss prevention executives have a unique opportunity to become key players in helping their businesses realise their full profit potential.

They can begin to help their organisations protect profits by losing less and through that contribute to the real goal, which is creating an enthralling and captivating retail experience for consumers. Ultimately, that is how you protect your business.

The writer is with the University of Leicester.