How Much Can Cyber Attacks Hurt Your Business?
The short answer is ‘more than you can imagine.’
What’s most alarming is that 56% of Americans don’t know what steps to take in the event of a data breach, but by the end of this article, you’ll be among the less vulnerable group.
Cyberattacks are a serious risk for any business, and food and beverage businesses aren’t any less vulnerable.
In this day and age, it’s safe to assume that everything from your POS to your payroll is reliant on being online.
A cyberattack is designed to access information systems, computer networks, computing devices, and even infrastructures, by using several programming methods that can steal, alter or destroy data and entire systems.
Unfortunately, most companies take nearly six months to detect a data breach. Just imagine the amount of sensitive information and business insights that could be stolen during that period, such as the credit cards being run in your business, as well as the social security numbers from your employees.
Remember, cybercrime is a big business, led by malicious individuals who sell valuable data to even more malicious organizations.
It’s not personal, it’s business
Some people wonder who would attack them if they don’t have any enemies. While that may be true, a study at the University of Maryland determined that hackers aren’t out to get you specifically, given the fact that most of these break-ins employ automated scripts that indiscriminately seek out thousands of computers at a time, looking for vulnerabilities.
You don’t need enemies; you just need to be online.
Despite growing awareness of the consequences of a successful attack, many businesses still underestimate the risks, especially when additional spending on security is discussed. Keep in mind that a successful cyberattack can impact the entire business in many ways and many levels, from minor operational damage to a total business meltdown that may force you to close down.
The average cost of a data breach is $3.92 million, as of 2019, but there are also other practices like ransomware. Imagine a hacker cutting you from accessing your own data until payment is arranged. The going rate these days is in the neighborhood of $133,000.
For many businesses, every minute of downtime brings measurable financial losses. So, a denial of a service attack could force you to shut down your business for a few days, causing you lost revenue. In fact, 60% of small businesses close within six months of falling victim to a cyberattack.
Businesses that suffered one will also generally incur additional costs associated with hiring professionals to repair the affected systems, networks and devices. Depending on your environment, restoring backups and performing other recovery operations may mean even more expenses will be incurred.
The main impact of a cyberattack is lost productivity, potentially all across the business. This starts with the time directly consumed by the incident, even after normal operations. Besides ongoing financial costs, lost productivity can undermine future growth or even affect the business’ continuity.
Under these circumstances, everything that you’ve worked so hard for can go out the window within seconds.
The moneymaking ability of your business is reflective of your reputation in the market, and an attack could potentially lead to losing advocacy, sales, reduction of profits, and of course, losing customers.
For larger businesses and franchises, the effect of reputational damage can even impact other stakeholders like suppliers, partners, investors and other third parties vested in your operation.
Trust is probably the most important yet most fragile aspect of any partnership or customer relationship. Customers and partners that have trusted you with their business and data can turn them away in anger and persuading them to stay or return will not be easy. Security breaches can devastate even the most resilient of businesses.
Of course, legal actions could be taken if a breach comes along.
Depending on the region and type of data, your business may be obligated to report breaches or suspected breaches, with potentially hefty fines for noncompliance.
Data protection and privacy laws require you to manage the security of all personal data you hold on both staff and customers. If this data is compromised, accidentally or deliberately, and you have failed to deploy appropriate security measures, you may face serious fines and regulatory sanctions.
Business owners can also face civil lawsuits from affected customers and business partners, in which case you may be forced to prove that the incident was not caused by negligence and that you did everything reasonably possible to maintain your best-practice security measures and procedures.
Cybercriminals are smart and often try to cover their tracks, so you’ll likely spend time and money on proving this.
Better safe than sorry
Now that we’ve gone over the risks, it’s time to take action.
- PolicySweet® business owners insurance helps to cover cyber-risk, so feel free to reach out as part of your cybersecurity planning.
- Click yes on updates. Your antivirus software company learns from other users and any vulnerabilities to their system.
- A good password is a game changer: Keep your passwords strong and change them regularly.
- Don’t keep all of your eggs in one basket. Make backups periodically and store them in a different system from a different provider.
- Be paranoid enough. Assume you are a target, and continuously audit your IT systems for suspicious activity. Don’t be afraid to hire a pro to perform this task sporadically.
Cyberattacks are a problem that can be fixed, but that doesn’t mean the damage can be completely undone. Even if your business survives, it could take a long time to get back to full strength. Cybersecurity is an ongoing process and to help keep your business secure from cyber threats you must continuously build a strong defense. Remember, we’re here to help.