Cyberattacks against large companies are undoubtedly a new thing. However, cost of Cybersecurity hackers often target small businesses with data breaches and other cyberattacks. Cybersecurity incidents can cripple your business and destroy client trust, and recovering from these attacks is costly. Enterprises of all sizes must implement cybersecurity measures to avoid these devastating consequences.
Like many business functions, cybersecurity generates expenses. But how much should you pay for your company’s cyber defence? We’ll discuss best practices for cybersecurity budget planning, describe the costs of cyberattacks, and share different types of cyber incidents to consider.
Why budget for cybersecurity?
Cybersecurity affects companies of all sizes. According to Netwrix Investigation Lab’s 2023 Hybrid Security Trends Report, 68% of all organizations surveyed (large and small) experienced a cyberattack in the last 12 months. Specifically, 43% of data breaches involved small businesses.
Here are some of the benefits of setting a cybersecurity budget for your small business:
- Protect your business: A cybersecurity budget funds programs that protect your business from the costs and disruptions of a cyberattack.
- Satisfactory risk assessment clauses: A funded cybersecurity plan acts as a safeguard to address third-party cybersecurity risk assessments (or other vendor requirements). Risk assessment clauses are becoming standard in contracts.
- Compliance Help: Your cybersecurity budget will help you comply with GDPR, PCI DSS, HIPAA, and other national or state regulations that legally require businesses to maintain cybersecurity standards.
- Keep your business competitive: Your cybersecurity will help you contest large projects or contracts.
What cybersecurity parts should your budget include?
The field of cybersecurity is enormous. When developing your budget, consider the following investment areas that small businesses should prioritize:
- risk assessment
- Preparation and business continuity.
- Incident response
- Employee training
- Identification and management of network and website vulnerabilities.
- Regular scans and testing, including Dark Web scans and ethical hacking
- Cyber Insurance Policies
If you’re not convinced your business needs a cybersecurity budget, know that your business won’t be the only victim of a cyberattack; Your staff, customers and strategic partners will also suffer the consequences.
The only way to stop an attack is to strengthen your understanding, posture, and defences, a process in which all small businesses are worth investing.
How much should you spend on cybersecurity?
Cybersecurity spending is typically tied to a company’s overall IT budget, which takes into explanation the company’s size and IT substructure. According to the 2023 State of IT Report, 54% of companies worldwide plan to increase their IT budget due to the following factors:
- Learn more about recent security incidents
- Update legacy systems to strengthen cybersecurity vulnerabilities
- Enhanced security software
- Spend more on managed security services
Statista says companies worldwide spend 12% of their IT budget on cybersecurity. For example, if a company pays $3,000 per month to a managed IT services provider for its IT needs, its cybersecurity budget would be approximately $360 monthly.
- However, the percentage of total IT spending spent on cybersecurity will vary significantly due to the following influences:
- Industry and business size
- Compliance and other orders that affect your business
- The compassion of the data you collect use, and share
- Requests from interested parties of the company or customers.
How much does a data breach cost?
Cyberattacks cause necessary damage and expenditure. According to IBM’s 2023 Cost of a Data Opening Report, the regular impact of a data breach on governments with fewer than 500 employees is $3.31 million; The regular cost per breached record is $164.
However, the total cost of a data breach is not always immediately known. Potential direct costs include:
- money theft
- Remediation and repair of the system.
- Regulatory and compliance fines
- Legal and public relations costs.
- Notification, identity theft repair and credit monitoring of affected individuals
- Increase in insurance premiums
Potential indirect costs include the following:
- Business interruption and downtime
- Loss of business or customers.
- Loss of intellectual property
- Damage to the credibility, brand and reputation of the company.
The concept of “cyber resilience” is gaining importance. Considering the potential expense and negative impacts of an information breach on a small business, any budget you spend on improving your company’s cybersecurity is well spent.
Five types of cyberattacks that threaten businesses
Your internal IT team or outsourced IT partner should be on the lookout for the following types of cyberattacks. Some are obvious, while others are overlooked attack vectors.
Denial-of-service (DoS) and distributed-denial-of-service (DDoS) attacks
A DoS attack is designed to overwhelm the resources of a machine or network so that intended users cannot access the system. DoS attacks are carried out by bombarding the specific target with a flood of traffic or information to crash the system.
Unlike other types of cyber risks, DoS attacks do not directly benefit the attacker. A competitor may launch a DoS attack to disrupt your website and gain an advantage, or it may be the first step in a more significant cyber threat.
A DDoS attack is comparable to a DoS attack but is hurled from many host computers. A DDoS attack aims to overwhelm a company’s website or service beyond what the server can accommodate so that it does not function properly.
There are different types of DoS and DDoS bouts, but these are the most common:
- TCP SYN Flood: These attacks can be avoided by placing servers behind a firewall.
- Ping of Death Attacks: A ping of death attack can be avoided by placing a server behind a firewall.
- Teardrop attacks: Teardrop attacks result from a common vulnerability in older versions of Windows. Various fixes have been released over the years. Keep your operating system up to date to avoid teardrop bouts.
- Botnets: Botnets can be prohibited by enabling RFC 3704 and black hole filtering.
Phishing and spear-phishing attacks
Phishing attacks are a typical cyber threat in which attackers send emails that seem to come from trusted sources. The goal is to obtain personal information, such as usernames and passwords, or trick someone into taking a specific action, such as downloading malware to their computer.
A phishing attack is similar, but instead of moulding a wide net, attackers target individuals and take the time to research victims and create personal, relevant messages.
The best way to prevent phishing attacks within your company is to train your staff on what to look for and how to spot risky emails and links.
Man-in-the-middle (MITM) attacks
As the name suggests, a MitM attack occurs when attackers insert themselves concerning a user and the services they interact with. Types of MitM attacks include session hijacking, IP spoofing, and replay attacks.
No single method can prevent all types of MitM attacks. However, encryption and digital certificates help prevent attackers from inserting themselves between users and servers.
Drive-by-download attacks
These attacks spread malware everywhere. An attacker searches for dangerous websites to hack and places malicious code through the site. When a user visits a slashed website, they may accidentally install malicious code or be redirected to a site created by the attacker.
Unlike other types of cyber threats, a drive-by download does not require any user action, such as clicking a button or opening an email, to become infected.
The best way to prevent these attacks is to train your workforce to keep their Internet browsers and working systems up to date and avoid dangerous websites.
Password attacks
Obtaining a user’s password is one of the oldest, most common and effective forms of cyberattack. Hackers can steal passwords in several ways:
- Watch someone type their password
- Finding unencrypted passwords on a network
- Using social engineering to reconstruct passwords
- Guess the correct password using brute force or dictionary attacks.
To protect your business from password attacks, implement two-factor verification policies, require your employees to use unique and strong passwords, and implement a policy that locks user accounts after multiple invalid password attempts.
Cybersecurity can mitigate — but not eliminate — attacks
Cybersecurity is no longer “fun”; it is essential for businesses and a necessary budget item. A comprehensive cybersecurity program doesn’t have to be very expensive but requires prioritization and commitment from management, IT, and other employees.
However, no matter how much you spend on cybersecurity, there is no guarantee of 100% protection. Your best option is implementing an ongoing, multifaceted cybersecurity program using resources, testing, training and time.
A comprehensive cybersecurity program costs a small price for the peace of mind of knowing your business is better protected.
