Defining profit loss in laymans terms - without using loss in the explanation

I believe the quoted definitions are technically correct. However, in keeping up with the spirit of the question, I would make the following suggestion.

Loss is the unrealized revenue due to theft, damage, or inaccurate and imprudent pricing of the product.

I would go for revenue in place of profit, for the simple reason that a stolen product not only negates the expected profit but does not break even the manufacturing cost.

I believe inaccurate pricing would refer to the incorrect sales tags while imprudent pricing would concern with the wrong judgement on behalf of the concerned sales management.

Not sure if it applies elsewhere, but the standard industry term in the UK is wastage, not loss.

I can't find an actual online definition, but I'm pretty sure wastage normally covers exactly and only theft, damage, and errors at point-of-sale, plus sometimes 'spoilage' of goods which were ok when delivered, but deteriorate in some way before being sold.

Companies don't usually like to be explicit about it, but in general wastage is preventable loss caused by undesirable employee action (or lack of desirable action, if they're simply not doing what they're supposed to).

Normally, wastage specifically doesn't include supplies which were defective when originally delivered, as that is accounted for separately (because it needs to be dealt with completely differently, on the supply side).

Your definition should therefore be...

Wastage: Unmade profit due to theft, damage, and point-of-sale errors.