Retail businesses are usually small with small budgets, is it possible for them to engage ERM in any meaningful way.
Retail activity is always exposed to many different risks that require dealing with it
To avoid any possible losses, the most important risks to retailers:
- Decreased consumer spending
- Reputation
- Increasing competition
- Supply chain failure
- Increase shopping across networks.
- Non-compliance with laws and legislation.
- Fraud and theft.
ERM involves a significant allocation of resources which many small and medium-sized businesses cannot afford, however a captive may provide a more viable alternatives, according to David Kirkup, COO and CFO at Captive Alternatives.
Have a look here https://www.captiveinternational.com/contributed-article/enterprise-risk-management-in-the-small-and-medium-company
Given how low the margins often are - while gross margin may be relatively high at around 50% in my experience, net margins after rent and wages are often very thin - fraud and theft are a significant cost in retail, as pointed out by Ali A. Naeem
Fortunately computerized point of sale systems are often equipped to assist as pointed out in the attached:
Article Retail point of sale fraud prevention and detection using in...
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