Cyber threats are no longer a concern only for large enterprises—small businesses are increasingly becoming prime targets for cybercriminals. With limited resources and weaker security defences, small businesses often make critical cybersecurity mistakes that expose them to data breaches, ransomware attacks, phishing scams, and financial fraud.

According to Cybersecurity Ventures, 43% of cyberattacks target small businesses, and 60% of those businesses close within six months due to the financial impact of a breach.

This article explores the most common cybersecurity mistakes small businesses make and provides expert solutions to help strengthen security, protect sensitive data, and avoid costly cyberattacks.

1. Ignoring Cybersecurity (Thinking You’re Too Small to Be Targeted)

Many small businesses believe they are too small for hackers to notice. Unfortunately, this misconception makes them an easy target for cybercriminals who exploit weaker security systems.

Why It’s a Mistake: 

• Hackers use automated tools to scan for vulnerabilities in businesses of all sizes. 

• Small businesses often lack IT security teams, making it easier to infiltrate networks.

Solution: 

• Treat cybersecurity as a business priority from day one. 

• Invest in firewalls, antivirus software, and endpoint protection. 

• Conduct regular security risk assessments to identify vulnerabilities. 

• Work with cybersecurity professionals to set up defences.

2. Weak Password Policies & Lack of Multi-Factor Authentication (MFA)

Weak password policies and a lack of Multi-Factor Authentication (MFA) are a hacker’s dream, leaving your business wide open to breaches.

Why It’s a Mistake:

• Password overload requires employees to create too many complex passwords often resulting in password reuse or simplified, easily guessed passwords. 

• Employees tend to choose variations of the same password or use the same password for multiple platforms significantly increasing the risk—if one password is breached, all accounts are compromised. 

• Storing or transmitting passwords without encryption exposes them to cybercriminals who can intercept or steal them. 

• Regularly requiring users to change their passwords doesn’t necessarily improve security instead it can lead to weaker passwords. 

• Hackers use brute-force attacks to crack weak passwords, exploit reused credentials through credential-stuffing attacks, eventually selling stolen or leaked passwords on the dark web.

Solution:

• Educate employees on how to create strong, unique passwords, particularly using the “three random words” technique. 

1. Generate three completely unrelated words (e.g., “bicycle,” “umbrella,” “elephant”). 

2. Combine them into a passphrase (e.g., “bicycleumbrellaelephant” or “Bicycle-Umbrella-Elephant”). 

3. Increase complexity (optional) by capitalising letters, adding numbers, or replacing some letters with symbols (e.g., “B1cycleUmbr3llaElephant”). 

• Encourage the use of password managers for secure storage and generation of unique passwords. 

• Reduce Reliance on Passwords by implementing Single Sign-On (SSO) and Multi-Factor Authentication (MFA) to minimise the number of passwords employees need to remember while adding an extra layer of protection. 

• Avoid Enforcing Password Expiry, instead, focus on educating users about creating strong passwords.

3. Lack of Employee Cybersecurity Training

Employees are the first line of defence against cyber threats, yet many small businesses fail to train their staff on basic cybersecurity practices.

Why It’s a Mistake: 

• According to the 2024 Verizon DBIR, the human element is contained in 68% of breaches. Of those, the Comcast Business Cybersecurity Threat Report says 80-95% are initiated by a phishing attack. 

• Employees may unknowingly click malicious links or download malware. 

• Social engineering attacks trick employees into giving up sensitive information.

Solution: 

• Conduct regular cybersecurity awareness training for all employees. 

• Educate employees about: 

1. Phishing attacks and how to recognise suspicious emails. 

2. Safe internet practices and avoiding unsecured websites. 

3. Handling sensitive data securely.   

Run simulated phishing tests to identify security gaps. 

4. Failing to Update Software and Security Patches

Using outdated software creates security vulnerabilities that hackers can easily exploit.

Why It’s a Mistake: 

• Cybercriminals target unpatched vulnerabilities in software and operating systems. 

• Older versions of CMS platforms (e.g. WordPress) and plugins can be exploited.

• Cybercriminals target unpatched vulnerabilities in software and operating systems.

Solution: 

• Enable automatic updates for operating systems, software, and security tools. 

• Regularly update business applications, plugins, and website CMS (e.g. WordPress, Shopify, etc.). 

• Remove unsupported software from your system.

5. No Data Backup Strategy

Losing critical business data due to ransomware, accidental deletion, or system failure can be catastrophic.

Why It’s a Mistake: 

• Ransomware attacks encrypt business data, making it inaccessible. 

• Data loss can disrupt operations and lead to financial losses. 

• Without a backup, recovery is nearly impossible.

Solution: 

• Follow the 3-2-1 backup rule: 

1. Keep 3 copies of your data. 

2. Store them on 2 different media types (e.g., external drive & cloud storage). 

3. Keep 1 backup offsite or in the cloud. 

• Regularly test backup recovery to ensure data integrity. 

6. Poor Access Control & Lack of Role-Based Permissions

Giving all employees unrestricted access to company systems increases security risks.

Why It’s a Mistake: 

• Increases the risk of insider threats or accidental data leaks. 

• If an employee account is compromised, hackers can access everything instead of limited areas. 

• Former employees may retain access to critical systems, posing a security risk. 

Solution: 

• Implement Role-Based Access Control (RBAC) to restrict access to sensitive data. 

• Regularly review and revoke access for former employees. 

• Use audit logs to track who accesses what data and when.

7. Overlooking Endpoint Security (BYOD Risks)

Allowing employees to use personal devices without proper security controls can lead to data breaches. 

Why It’s a Mistake: 

• Personal devices often lack antivirus software, encryption, or secure access policies. 

• Employees might download unauthorised apps that introduce malware into company networks. 

• Lost or stolen unprotected personal devices can expose sensitive business data. 

Solution: 

• Establish a Bring Your Own Device (BYOD) policy with security guidelines. 

• Require employees to install security software and enable encryption. 

• Enforce remote wipe capabilities on all business-connected devices. 

8. No Cybersecurity Incident Response Plan

Without a plan, businesses struggle to respond quickly to cyber incidents.

Why It’s a Mistake: 

• Without a clear incident response plan (IRP), businesses struggle to contain and mitigate a cyberattack. 

• Delayed response times can increase financial losses and data exposure. 

• Lack of preparation may lead to legal non-compliance, further damaging a company’s reputation. 

• A poorly handled breach can result in customer distrust and lost business. 

Solution: 

• Develop a Cybersecurity Incident Response Plan (CIRP) detailing who does what in case of an attack. 

• Define clear steps for identifying, containing, eradicating, and recovering from cyber threats. 

• Conduct regular tabletop exercises (TTX) to test your team’s preparedness. 

• Assign a dedicated incident response team (internal or outsourced). 

• Have a PR and communication strategy ready to notify customers & stakeholders in case of a breach. 

Ignoring Compliance & Regulatory Requirements

Failing to comply with data protection laws and cybersecurity regulations can result in legal penalties, lawsuits, and loss of customer trust.

Why It’s a Mistake: 

• Businesses that store customer data (e.g., names, emails, credit card details) must comply with laws like GDPR, CCPA, PCI-DSS, HIPAA, etc. 

• Non-compliance can lead to fines as high as millions of pounds in certain industries. 

• Ignoring regulatory requirements can cause legal battles, reputational damage, and even business shutdowns. 

• Customers are less likely to trust a business that fails to meet security and privacy standards. 

Solution: 

• Research and understand which compliance laws apply to your business and industry. 

• Work with Incursion Cyber Security or legal experts to ensure compliance. 

• Implement data protection policies to align with GDPR, CCPA, or PCI-DSS regulations. 

• Use encryption and access control to protect customer data. 

• Conduct regular compliance audits to identify gaps and risks. 

Avoiding these common cybersecurity mistakes can protect your small business from financial losses, legal issues, and reputational damage. Investing in strong cybersecurity practices ensures long-term business success and customer trust.

UNSURE WHERE TO BEGIN?