The reason for the use of the singular casualty is to imply that small shops (collectively) are one casualty among many other groups of entities. Another example:
Private equity funds are a significant factor in the rapid increase in housing prices, in certain markets.
It may be grammatical to say "the funds are significant factors", but this changes the meaning to suggest that the funds each have a separate effect, rather than that, together, they have a collective effect among other (unmentioned) groups that also have an effect (e.g. foreign investors, families with rising incomes, etc.)
Of course if we were talking about one specific fund, then we would use the singular:
The Donald Trump 'Best Fund in the World' Fund is a significant factor in ...