Contrary to popular belief, cyber attacks are not exclusively targeted at large corporations. Indeed, a recent study revealed that 43% of all cyberattacks target small businesses.
Financial Implications
The financial repercussions of cyberattacks on SMEs are significant. Over the past five years, UK businesses have collectively lost approximately £44 billion due to cyberattacks, with half (52%) experiencing at least one attack during this period. This equates to an average loss of 1.9% of annual revenue per business affected. However, whilst this may not seem like a large amount in monetary terms the damage goes way beyond that.
Operational Disruption
Beyond direct financial losses, cyber incidents can severely disrupt business operations. A notable example is the case of KNP, a 150-year-old logistics company that succumbed to a ransomware attack in 2023. The attack crippled their systems, leading to ransom demands and threats to publish sensitive data. Despite complying with cybersecurity protocols and holding insurance, KNP went under within three months, resulting in 730 job losses.
Reputational Damage
The aftermath of a cyberattack often includes reputational harm. Clients and partners may lose trust in a company’s ability to safeguard sensitive information, leading to contract terminations and a decline in new business opportunities.
Lessons for SMEs
Invest in Cybersecurity: Allocate resources to implement robust security measures, including firewalls, antivirus software, and intrusion detection systems.
Employee Training: Regularly train staff to recognize and respond to cyber threats, such as phishing emails and suspicious links.
Data Backup: Maintain regular backups of critical data to ensure business continuity in the event of an attack.
Incident Response Plan: Develop and regularly update a comprehensive incident response plan to mitigate damage during a cyber incident.
Cyber Insurance: Consider obtaining cyber insurance to help cover potential financial losses resulting from cyberattacks.
Contrary to popular belief, cyber attacks are not exclusively targeted at large corporations. Indeed, a recent study revealed that 43% of all cyberattacks target small businesses.
Financial Implications
The financial repercussions of cyberattacks on SMEs are significant. Over the past five years, UK businesses have collectively lost approximately £44 billion due to cyberattacks, with half (52%) experiencing at least one attack during this period. This equates to an average loss of 1.9% of annual revenue per business affected. However, whilst this may not seem like a large amount in monetary terms the damage goes way beyond that.
Operational Disruption
Beyond direct financial losses, cyber incidents can severely disrupt business operations. A notable example is the case of KNP, a 150-year-old logistics company that succumbed to a ransomware attack in 2023. The attack crippled their systems, leading to ransom demands and threats to publish sensitive data. Despite complying with cybersecurity protocols and holding insurance, KNP went under within three months, resulting in 730 job losses.
Reputational Damage
The aftermath of a cyberattack often includes reputational harm. Clients and partners may lose trust in a company’s ability to safeguard sensitive information, leading to contract terminations and a decline in new business opportunities.
Lessons for SMEs
Don’t sleep on this, don’t add to the stats.
Sources:
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