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What To Do if Your Small Business Has a Data Breach
Running a small business is no small task. Between managing employees, covering expenses, and keeping customers happy, you’re already wearing a variety of hats.
And now you have to add data breach management to the list? Unfortunately, in today’s digital world, cybersecurity threats are a reality small business owners can’t ignore.
Cybercriminals have shifted their focus to smaller, more vulnerable organizations. In fact, 82% of ransomware attacks now target smaller businesses, which often lack the resources, employee training, and safeguards that larger corporations have. That makes them easier targets.
When a data breach occurs, the consequences can be devastating. Up to 60% of small businesses that are targeted in a cyberattack go out of business within six months.
It’s a terrifying statistic, but here’s what matters: in the event of a data breach, there are tried and true steps you can take to mitigate your losses, meet your obligations, and start rebuilding trust with your customers.
In this article, we’ll walk you through what to do immediately following a breach, so that you can get back to business with confidence.
Why Small Businesses Are Prime Targets for Cybersecurity Attacks
In 2023 alone, 350 million people were affected by data breaches. And while cybersecurity attacks can affect companies of any size, small businesses are disproportionately affected.
According to the Verizon Data Breach Investigations Report, small businesses account for 43% of all data breaches.
Unfortunately, many of those small businesses are underprepared. A recent study revealed that nearly one quarter of small businesses have no device security, and one in three rely on free or basic solutions that may not offer strong security coverage.
On top of that, many small businesses also admit that their teams are inadequately trained to spot and stop cyberattacks before they spread.
To make matters worse, hacker tactics continue to evolve. From malware to phishing emails, cybersecurity for small businesses continues to get more complex. The chart below shows the most common cyber risks in 2025, including data breaches:
Clearly, there’s plenty of risk to contend with. Without rigid data breach prevention tactics in place, small businesses stand to lose a great deal, and the repercussions can be devastating.
The cost of a small business data breach can vary, but recent research shows cybersecurity incidents can cost small businesses an average of $2.98 million.
Small business data breach statistics are sobering, but there is hope. If your business experiences a data breach, acting quickly is the only way to prevent further damage and protect against long-term fallout.
The First 24 Hours Following a Data Breach: Containment Matters Most
When a data breach occurs, time is your most valuable asset. Waiting even a few hours to begin managing the situation can significantly increase the damage, and in many cases, the clock has already been ticking by the time you discover the problem.
According to IBM research, it takes an average of 277 days to identify and contain a data breach, largely because many go undetected for long periods. Larger organizations typically discover breaches faster than small organizations because they have strong, established cybersecurity practices.
Unfortunately, many small businesses find themselves unprepared to respond quickly, with half of small businesses reporting it took 24 hours or longer to recover their website after a cyberattack.
However, according to an IBM Data Breach Report, businesses that are able to contain a breach within 30 days can save over $1 million, so the sooner you can respond to a data breach, the better.
The Federal Trade Commission (FTC) recommends critical first steps when a small business data breach occurs.
1. Secure Your Business Quickly
As soon as you’re aware of a breach, focus on containment:
- Hire a data breach response team like IDIQ quickly
- Lock down any affected systems or physical areas
- Remove any exposed information from your website, then request removal from third-party websites or search engines
- Update passwords and any other access credentials
Taking these actions in the first 24 hours limits additional exposure and sets the foundation for recovery.
2. Consider and Address Vulnerabilities
Containing a small business data breach is only the first step, but understanding how it happened is just as critical.
Small businesses often rely on external providers for payroll services, IT support, and other key tasks that they can’t manage internally, meaning vendors could be a significant vulnerability. In fact, a recent study found that 35.5% of breaches in 2024 involved third-party vendors with access to sensitive data.
Review the information your vendors have access to and adjust or revoke privileges as necessary. Be sure you trust their security processes (and verify they make any necessary changes if they were responsible for the breach) before continuing your partnership.
Your Legal Obligations & Notifications
Every state has its own rules regarding how and when a business must notify customers after a data breach. Most require businesses to notify affected individuals within 30 to 60 days. Failing to do so can result in steep fines and lawsuits, and the loss of your customers’ trust.
IT Governance USA offers state-by-state data breach laws so you can understand exactly what’s required in your area.
IDIQ’s data breach response services help take care of breach notification requirements, helping you stay compliant while protecting your business and customers.
Use Identity Theft Protection
While not a legal requirement, adding identity theft protection services can help you better support your customers.
IDIQ’s identity theft protection services provide real-time monitoring, dark web scanning, and fraud restoration services for comprehensive support.
By giving your customers a proactive solution, you can reduce both the cost of the breach, improve customer sentiment, and make the experience less overwhelming.
Communicating a Data Breach to Your Customers
When a data breach occurs, your customers can face some of the worst fallout. Up to 87% of small businesses hold sensitive customer data, ranging from addresses to credit card details, that could be exposed in a breach.
The trickle-down effect of a data breach can impact customers in more ways than one. In 2023, 60% of companies that suffered a data breach were forced to raise their prices to recoup their losses. This means consumers don’t just deal with having their information exposed, but can end up paying the price even long after the breach is over.
When you notify your customers, be sure to let them know:
- What happened and when it occurred
- The data that was (or may have been) exposed
- The steps you’ve already taken to contain the breach
- What your customers can do to protect themselves, such as credit monitoring or identity theft protection
- How you’ll keep them updated moving forward
Be honest and transparent. Share real details, don’t downplay the situation, and let your customers know how your data breach response plan provides them with ongoing protection.
This type of clear, transparent communication shows accountability and can prevent long-term damage to customer trust.
Preventing Your Next Data Breach
There are key steps you can take to prevent future data breaches. The FTC offers 10 simple steps for small businesses to consider:
- Train employees: Up to 47% of businesses with less than 50 employees report having no cybersecurity budget, meaning staff mistakes can quickly turn into unintentional but costly incidents. Create a clear set of rules for passwords and handling sensitive information.
- Protect devices from cyberattacks: Ensure software, browsers, and operating systems are up to date. Run antivirus scans to spot problems quickly.
- Use firewall security: Enable firewalls on all systems to block unauthorized access.
- Consider mobile devices: If your team needs to use mobile devices for work, require password protection, encryption, and security applications. Create a process to report lost or stolen equipment.
- Back up your data: Implement automatic, regular backups of essential files and store them offsite or in a protected cloud network.
- Control access to information: Restrict access to business computers or data, set up individual user accounts with passwords, and limit admin privileges to only essential staff.
- Secure your Wi-Fi: Hide and password-protect Wi-Fi networks to prevent outside access.
- Protect company credit cards: Use anti-fraud tools and isolate your payment systems from general internet use.
- Limit employee access to data: Give employees access only to the tools and/or data essential for their role.
- Strengthen passwords and authentication: Weak or stolen passwords account for 80% of hacking incidents. Require your team to regularly update their passwords and use multi-factor authentication (MFA) for an added layer of security.
How IDIQ Can Help You Navigate a Data Breach
A data breach can be devastating for a small business, but how quickly you respond helps determine how your organization recovers. That’s why IDIQ provides comprehensive data breach response plans designed to move quickly.
With advanced monitoring and around-the-clock support for your team members, employees, or customers who have had information exposed in a data breach, you can rest assured you have the help you need to stop the spread of a data breach when you need it.
With IDIQ, you gain access to:
- 24-Hour guaranteed response time, so you get the help you need as fast as possible
- Customized recovery plans built for your business
- Dedicated support so you get the best care tailored to your unique needs
- Customer notification support to help you manage notifying affected people
- Identity theft protection services to help protect affected customers and employees
With nearly two decades of cybersecurity experience, IDIQ can help you navigate the stress, legal obligations, and end-to-end tasks necessary to protect your brand and your customers.
Reach out to IDIQ’s data breach response team today for the support you need to take back control.
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