London, UK Skyline. Photo: Ali Yaqub / Unsplash
Small businesses in the UK could lose 7.27% of their value - an average of £6,906 (about $8,483) - in the event of a severe data breach, new research shows.
Research findings published in a data breach report by cloud solutions company iomart, analyzed the financial impact of typical, severe and catastrophic data breaches to reveal what each could cost top companies and social media platforms.
The typical data loss for a large company is between 10 and 99 million records per incident, resulting in an average company value drop of 7.27%. This equates to an average potential loss of $32 (£27.2) billion for top Nasdaq 100 companies and $8.8 (£7.4) billion for FTSE 100 businesses.
This loss of value could prove catastrophic for small businesses, with the average SME being worth £95,000 (about $116,684) in the UK. With 99% of all businesses being small to medium enterprises, these potential losses could substantially damage the wider business economy.
The amount lost per breach is determined by the time it takes to identify and contain a data breach, with leading tech companies facing potential losses of £14.1 million (about $17,3 million) per day as a result of taking a total 236 days to fully recover from a breach.
With 60% of businesses reported as having experienced a serious security breach in the last two years, it’s crucial that business owners take steps to prioritize data security in order to minimize loss in the event of a substantial breach.
Steps to prioritize data security
In comments on the study findings, Bill Strain, Product Development Director of iomart, offers some observations and recommendations to prioritize data security in your small business:
“These figures are a stark warning about the importance of investing in data protection. Many smaller businesses wouldn’t survive the operational impact of a successful cyber-attack, let alone the financial one of a punishing fine on top.
More tips for an effective defense against data breaches
The experts at iomart also list some top tips on how businesses can create an effective defense against such an attack:
Keep IT systems and software up-to-date
Store sensitive data separately
Control users’ access and privileges
Secure the email gateway
Do regular off-site backups of your data
Provide regular security training for all staff
“It’s still the case that most cyber-attacks start by exploiting our human vulnerability,” Bill adds. “By training staff to spot suspicious emails or links you can lock the front door and then use technological solutions to ensure the hackers can’t get in around the back.”