The average cost of a data breach for a small-to-midsized business can vary depending on the size of the business. For small businesses with fewer than 500 employees, the average cost was around $2.98 million in 2023. On the other hand, for businesses with 500-1,000 employees, the average cost was slightly lower at $2.63 million, while for businesses with 1,001-5,000 employees, the cost jumped to $4.09 million.
Data breaches can also lead to indirect costs such as business interruption, damage to reputation, and difficulty in attracting future customers. These factors can significantly impact a small business and may even lead to closure post-breach. Additionally, the consequences of a data breach go beyond financial losses; they can result in loss of trust from customers and damage to the company’s reputation, potentially leading to long-term negative effects on the business.
Investing in cybersecurity measures like incident response teams, employee training, encryption, and cyber insurance can help mitigate the impact of data breaches and reduce associated costs. It is crucial for small-to-midsized businesses to understand the risks posed by cyberattacks and take proactive steps to protect their data and systems to avoid potentially devastating consequences.
