The average cost of data breaches
For many business owners, data breaches sound like things that happen to other people. After all, who would want to steal data from a SME like yours?
Well, as it turns out, a surprising number of people would definitely be interested… Order a free printed copy of our book to find out more.
Small businesses and data breaches
It’s certainly true that a bigger business has more to lose. The average cost of a data breach in 2019 was reported as being over £2 million for smaller companies (smaller, in this context, being companies with between 500 and 1000 employees).
For many small and medium businesses, those numbers seem so far beyond them that they don’t need to worry. But the important takeaway from recent reporting is that the smaller your business, the disproportionately more it will be affected by a data breach.
Because the cost of a data breach for a big business can be even higher – around £4 million. But that cost is much smaller per employee (because here we’re talking about companies with over 25 000 employees).
That means the monetary cost of data breaches do get smaller as your business does. But the comparative cost is much higher.
How much does a data breach cost?
You might imagine that a data breach is a big, one-off hit. Maybe a business can roll with it, take the financial punch and start clearing up the damage on the other side.
Unfortunately, the costs associated with data breaches don’t all hit you at once:
- Direct costs – there are direct costs. Your sales will take a hit, as will your share prices if you’re on the stock market. There will also be the cost of things like legal services, any investigation which might be necessary, and any other measures you need to take after the breach to show that you’re responding to it. But direct costs aren’t really where the damage comes from…
- Indirect costs – if someone hears that your business doesn’t properly protect their data, they’re going to be less keen to do business with you. As consumer trust falls and business opportunities with potential partners are missed, you will need to work hard to repair the reputation damage and you’ll be losing sales the whole time.
- Hidden costs – how many hours are your team going to need to spend to deal with the data breach? How many projects or other aspects of running your business are you going to need to pull attention away from to sort this whole thing out?
Those costs usually keep coming too. The first year might see your business need to deal with most of them. But around 33% of the costs of a given data breach will keep coming at a company for the next two years.
It doesn’t help that the average amount of time it takes to spot and stop a data breach is 279 days.
So what’s the most cost-effective solution for data breaches?
It might sound a little trite, but the most cost-effective way to deal with data breaches is not to have one in the first place.
The comparative cost of having a sensible cybersecurity set-up to protect you from data breaches is so much smaller than the actual cost of a breach that it’s not even pennies on the pound.
It’s not complicated to protect your company either. All you need to do is take the first step. And get the problem sorted before it even occurs.
How easy would it be to protect your business from possible data breaches?
Start from ordering a free printed copy of our book ‘Who’s Reading Your Email?’ It explains how hackers work and what are the exact steps you should take to protect your business.
Then, let’s chat. We provide a stress-free way to get all the information you need. Plus, managed services which take all of the work off of your hands.
Nearly 1000 businesses in and around Bristol trust us with their IT. Why shouldn’t you?