Cyber threats cost Australian businesses AUD $300 million

A significant number of Australian small businesses are not adequately investing in critical coverage and risk management strategies, according to a recent report by Localsearch.

The Localsearch State of Small Business Report 2024 highlights that 91% of Australian small business owners have not invested in insurance coverage and risk mitigation strategies that are tailored to address potential threats. The report reveals that cybercrime is costing these business owners approximately AUD $300 million annually, with the Australian Cyber Security Centre (ACSC) receiving a cybercrime report on average every ten minutes.

The data indicates that fewer small business owners are setting themselves up for success by employing adequate security measures compared to the previous year. In 2023, 24.5% of respondents had expanded their online presence to reach wider audiences, whereas this year, the figure stands at 13%.

Most Australian small businesses, amounting to three-quarters, have not implemented enhanced cybersecurity measures to safeguard against cyber threats and data breaches. This mirrors findings from the previous year's report, with only 22% of respondents claiming to have such enhanced measures in place.

Gary Mandelkow, Chief Technology Officer at Localsearch, commented on the findings, stating, "Cybercrime is an ever-growing threat to Australian small businesses, and the alarming statistics in our latest report highlight just how vulnerable many are. Despite the rising costs and frequency of cyberattacks, the majority of small business owners are still not investing in the tailored insurance coverage or proactive cybersecurity measures needed to protect their assets."

He further noted the financial implications, saying, "With cybercrime costing Australian small businesses an estimated AUD $300 million annually, it's crucial that owners prioritise cybersecurity and risk mitigation as part of their long-term business strategy. The good news is that it's never too late to start — investing in the right tools and strategies today can help secure the future of any small business."

Mandelkow emphasised Localsearch's commitment to supporting small businesses, stating, "At Localsearch, we're committed to not only providing practical tools to help businesses thrive but also arming small business owners with the knowledge required to set their businesses up for success."

The report, which represents the final part of Localsearch's annual State of Small Business Report, surveyed a sample of 512 Localsearch customers involved in small to medium-sized business ownership across Australia. The findings follow previous iterations that focused on mental health and skill shortages among Australian small business owners. Overall, the report underlines a pressing need for better preparedness against the financial and operational risks posed by cyber threats.

Data was collected between 17th September and 9th October 2024, with a sample of 512 Localsearch customers - Australian-based small to medium-sized business owners. This news follows the first two iterations that were focused on Australian small business owners' mental health and skill shortages. These three iterations form Localsearch's State of Small Business Report 2024.