Top Challenges Small Businesses Face with Data Security
Running a small business comes with plenty of challenges, and data security is one that’s easy to underestimate. But here’s the thing—ignoring it can be a costly mistake. Hackers know small businesses often have weaker defenses, and they take full advantage of it. In fact, 43% of cyberattacks worldwide target small businesses, yet only 14% of those businesses are ready to handle them. It’s a serious problem, but with the right steps, you can protect your business.
Photo by MART PRODUCTION
1. Not Knowing What You Don’t Know
Cybersecurity can feel like a foreign language if you’re not in the tech world. Many small business owners assume their operations are too small to attract hackers, but that’s far from the truth. Hackers love easy targets, and a small business with minimal defenses fits the bill perfectly.
Even something as basic as falling for a phishing email can cause big headaches. Did you know 90% of breaches start with phishing? That’s right—just one click on the wrong email link could mean trouble.
What to Do About It:
Train your team! A little education goes a long way. Show your staff how to spot suspicious emails and other common traps. It’s a simple, low-cost way to stay ahead of many attacks.
2. Tight Budgets, Big Risks
Let’s face it: most small businesses don’t have the budget to throw at cybersecurity tools or hire an IT expert. But here’s the kicker—a data breach is often way more expensive than the security measures that could’ve prevented it. The average cost of a breach for a small business is $120,000. Imagine how that could impact your bottom line.
Easy Fixes:
Use affordable cloud-based security tools—they’re designed for businesses like yours.
Look into free or low-cost encryption options to keep your data safe.
3. Weak Privacy Policies (or None at All)
When was the last time you updated your privacy policy? Or do you even have one? Many small businesses overlook this step, but having a solid privacy policy is a game-changer. It protects your customers, builds trust, and keeps you compliant with laws like GDPR or CCPA.
But don't forget about GLBA compliance, which states that all service providers are required to ensure an adequate level of data security. But you can always ensure compliance with VeePN and those agencies that adhere to high security standards. Considering that 51% of data breaches in small businesses originate from third-party vendors, such security measures will not be superfluous.
What Can Be Done?
Skipping this can cost more than you think. GDPR fines, for example, can reach up to €20 million. Ouch.
Quick Tip: Write a privacy policy that’s clear and easy to understand. Don’t just copy-paste something generic. Tailor it to your business and make sure it covers how you handle customer data.
4. Ransomware Is on the Rise
Ransomware attacks are exploding. Hackers lock up your data and demand payment—usually in crypto—to get it back. They know small businesses often don’t have backups or security plans, making them an easy target.
Just to give you an idea, ransomware attacks went up 13% last year, and a lot of the victims were small businesses. Even scarier? 60% of small companies shut down within six months of a cyberattack.
How to Prepare:
Set up automatic backups so you always have a copy of your data.
Add two-factor authentication (2FA) to your accounts. It’s an easy extra layer of security.
5. Trusting the Wrong Partners
If you use third-party vendors—think payment processors or cloud services—you’re only as secure as they are. A weak link in their systems could put your data at risk.
Studies show 51% of breaches in small businesses come through third-party vendors. That’s a huge number, and it shows why you need to choose your partners wisely.
Pro Tip:
Ask your vendors about their security practices. Don’t assume they’re taking care of things.
Review contracts to make sure they’re accountable for protecting your data.
6. Employee Slip-Ups
Not every breach is caused by hackers. Sometimes, it’s just someone making a mistake—like clicking a bad link, using a weak password, or leaving their account open. In fact, human error is behind 82% of breaches, according to Verizon’s 2022 report.
How to Fix It:
Make password updates a regular thing.
Create simple, clear steps for reporting anything suspicious.
7. Using Outdated Technology
Old tech might save you money upfront, but it’s a ticking time bomb when it comes to security. Outdated systems often don’t get updates anymore, leaving them wide open to attacks. The WannaCry ransomware attack is a classic example—businesses that hadn’t updated their software were hit the hardest.
What You Can Do:
Stay on top of updates for all your software and devices.
If you’re using ancient systems, it’s time to upgrade. Modern options often include built-in security features that older ones lack.
The Bottom Line
Data protection for small businesses isn’t just about avoiding fines or attacks—it’s about keeping your business alive and thriving. Hackers aren’t slowing down, but you can stay ahead with some smart planning and basic precautions.
Remember, you don’t have to do everything at once. Start small. Train your team, update your software, and tighten up your privacy policy. Every step you take makes your business safer and more resilient.