TechRepublic recently published an article on how data breaches are hurting small businesses. According to Kaspersky, “the cost of enterprise data breaches has risen to $1.41 million, up from $1.23 million in the previous year. As a result, enterprise organizations invested more in cybersecurity in 2019, with IT security budgets averaging $18.9 million compared to $8.9 million in 2018.” Their research from the “IT Security Economics in 2019: how businesses are losing money and saving costs amid cyberattacks” survey shows that in the first half of 2019 there have been almost 4,000 data breaches! Here is what we learned from Techrepublic’s article and Kaspersky’s research.
1. Hackers Don’t Discriminate
Hackers want to get their hands on your data no matter what size your business is or what you do. You have an even bigger target on your back if you handle clients Personal Identifiable Information (PII). These credentials are sold on the dark web for dirt cheap so cyber criminals can commit identity and bank fraud. So, the more data they steal the more money they make.
If you catch yourself saying, “my business is too small for hackers to pay attention to”, think again. The smaller the business is, usually, the easier the target is for hackers to attack. This is because more than likely their cyber security measures are not as robust as their Fortune 500 counterparts.
2. Data Breaches Cost Your Business Money
21% of small businesses (SMBs) reported a data breach within the last two years according to the Bank of America Merchant Services’ third-annual Small Business Payments Spotlight . This number is up by 17% from two years ago. In addition to this 41% of SMBs reported that their data breaches ended up costing them over $50,000 to recuperate from.
Are you curious as to how much a data incident would likely cost your business? Use our downtime calculator to determine how long your business operations can be down and how much that lost time will cost you. To define what type of loss you can afford, you should calculate what you spend on backups (ex…the type and frequency of backups).
More than likely, your business will not be able to afford any loss.
When considering how much a cyber-attack can cost your business there are other factors to consider besides the downtime itself. Think of:
- How much you will have to pay in fines/penalties
- How much your insurance premiums will increase
- How much it will cost for new software and employee training to try and avoid another breach in the future
- How much productivity, time and/or revenue is lost
3. A Breach Can Cost You Loss of Customers Too
If your business gets breached there is a chance that you could lose a portion of your customer base. According to the Bank of America Merchant Service’s report, 29% of customers won’t go back to a SMB who has been hacked. This statistic is up 20% from last year! Consumers are becoming more wary of how their information is being handled in the increasingly digital age.
Think about your company’s reputation after being the target of cybercrime? What does that mean for future business? New potential customers might not conduct business with companies that have a reputation for being data breach victims. It is paramount for business to keep their customers data safe to remain credible in today’s business landscape.
Thoughts From an Industry Expert
“As a business owner in the IT space, I know what a hacker is capable of once they gain access to someone’s credentials in a company. RMON is proactive with their approach to cyber security by utilizing additional tools such as, multi factor authentication and dark web monitoring of our domain. It’s not a matter of if you will get hacked, it’s a matter of when.”
– Tim Howard, RMON Networks’ President & CEO
Small business owners should never assume that their company is too small for hackers to target. They can hold the key to their customers personal/financial information, which is all a hacker needs to commit identity fraud. Plus, smaller businesses typically don’t have the cyber security measures in place that larger companies have, making them an easier target for hackers. Don’t let your company be the easy target! Make sure that cyber security education is standard practice in your company to help mitigate the risk of sensitive data slipping into the wrong hands.