The cost of cybercrime for your small business

We`ve recently found when visiting prospective clients that the majority of them still aren`t really educated on cybercrime. What makes this even more alarming is that they already use an IT support company. They have never really been educated about security and that cyber criminals not only focus on larger businesses as they also find small businesses are also a target worth chasing. One of the things we like to educate our clients on is what the cost of cyber crime could be to their business. We thought we`d share some of the main points we speak to clients about so that they are truly aware of the potential pitfalls.

Internet crime is put into two categories known as information theft and digital vandalism. Theft often includes financial information, product proprietary information as well as customer records. This is stolen and often sold on to other criminals. Digital vandalism will include Denial of Service attacks, viruses and malware and these can stop the productivity of businesses.

The cost to smaller businesses

Any business can be hit hard by the theft of customer information and that is true for smaller businesses. This kind of damage can lead to losses and imminent closure of the business as their reputation can take a fall.

The costs associated with these attacks can mean the end for them and around 36% of attacks are aimed at SMBs with around 60% of them going out of business within six months. What could be more alarming is the fact that almost 80% of SMB owners believe that they are protected from such attacks.

The costs of these attacks can differ depending on the financial strength of the business but the list below shows the kinds of costs that could be experienced following an attack.

Loss of business

Any form of security breach will mean that the business has to shut down for a period of time. If a Denial of Service attack takes place then it could be shut down for a few days as it attempts to determine where the attack originated from. This could also be the case if a data breach occurs where credit card information was stolen.

Loss of assets

If bank account details are stolen then this could result in money being taken from the account, which would mean that the business would lose its working capital. Other information, if stolen, such as customer records and employee information could cause massive losses.

Bad reputation

It is difficult to put a value on the damage caused to the reputation of a business following an attack but one thing is for sure, it can be difficult to turn things around. Customers will be reluctant to give information and they will be reluctant to make a purchase. For any SMB this kind of damage could cause problems and depending on the nature of the business it could mean that their search engine rankings are affected which would mean that it loses further business.

Legal action

If a SMB fails to put in place the correct protection which results in the loss of customer information, it could result in legal action being taken. A small business has to understand the risks involved and the importance of putting protection in place.

Costs associated with protection

This is an important cost because this is the first outlay in an attempt to prevent attacks. Any business, regardless of size needs to put a strategy in place to protect itself from cybercrime. This can range from using strong password protection and layered security including antivirus, mail protection and internet monitoring to implementing complete network intelligence systems.

The importance of action

The biggest risk that any business faces is doing nothing. Cybercrime is a reality and it is out there and this means that it is never going to go away. We`ve spoken to small business owners in the past who do very little in terms of security (not even having an email protection solution) and for them it’s a question of when, not if a problem will occur and unfortunately, by this time it`s too late.

Making clients aware of the costs to them is just one part of how we like to educate. If you`re looking for further information on how to keep your business safe and secure please get in touch.