Around half (45%) of small businesses across the UK have no contingency plan in place to deal with a potential data breach within their business, with many grossly understating the potential cost of experiencing one.
That’s according to Experian’s annual data breach preparedness study – the third of its kind to be carried out among small and medium-sized enterprises (SMEs). The most concerning statistic to come out of the report was the lack of understanding among SME owners regarding the true cost of a business data breach, with estimates some 40% below the probable figure on average.
Recent government figures suggests any SME hit by a data breach would be lose as much as £310,000, while the SMEs Experian surveyed estimated the total to be £179,990 on average.
If a data breach of a business becomes public knowledge, there’s no doubting the effect it has on its reputation in the eyes of the consumer. Two-thirds (64 per cent) of consumers said they would be discouraged from buying from an SME after it had experienced a cyber attack.
Jim Steven of Experian insists it is high time that small businesses opt not to bury their heads in the sand and adequately prepare for the worst, given that they are some of the most vulnerable to a data breach.
“Our study has uncovered an ‘it’ll never happen to us’ attitude among Britain’s most vulnerable businesses,” said Steven.
“While it’s understandable that smaller businesses may feel they lack the resource or expertise to prepare for a data breach, they are also the most vulnerable.
“Whether due to sophisticated cybercrime or basic human error, the true cost of a breach is far worse than companies are imagining.
“For small companies especially, businesses need to ask themselves whether their business could survive if two-thirds of their customer base were to disappear overnight.”
Complacency appears to be the primary reason for failure to take action against data breaches, with 51% of SMEs still failing to recognise it as a priority.
If you’re looking for ways to evolve your business’s IT systems, feel free to contact us at Nimbus CS – we’ll tell you in straightforward, easy-to-understand terms how best to improve your business operations both in terms of security and efficiency.