The argument is about the profit of small retailers, not large discount chains. Whether or not some discount chains fail to make a profit doesn't affect the author’s argument.

The author is addressing what small retailers need to do in order to retain their customers and profit. It doesn't matter whether some large discount chains have lower profit margins than some small retailers; the author never compares the two.

This doesn't affect the author’s argument, because her conclusion is only addressing what small retailers need to do in order to retain profitability. Whether or not they want to retain profitability is irrelevant.

This is irrelevant because the author’s conclusion isn’t about all small retailers. Instead, it only addresses “small retailers that are forced to compete with large discount chains.”

The author’s conclusion mistakenly treats “offering exceptional service” as a necessary condition, while in the premises, it’s merely sufficient. In other words, she overlooks the possibility that customers may prefer small retailers for other reasons.