Australian small firms risk exposure amid cyber threats

A recent report from Localsearch reveals that most Australian small businesses are not investing in essential insurance coverage and risk mitigation strategies, leaving themselves exposed to potential cyber threats.

The Localsearch State of Small Business Report 2024 indicates that cybercrime inflicts a financial burden of approximately AUD $300 million annually on Australian small business owners, with the Australian Cyber Security Centre receiving a report of cyber incidents every ten minutes on average.

According to the report, a staggering 91% of Australian small businesses do not invest in the necessary coverage and planning to mitigate risks. This data highlights the ongoing challenges faced by small business owners in the current landscape.

The report further reveals a decline in preparedness compared to the previous year. In 2023, 24.5% of small business owners were looking to expand their online presence, compared to just 13% in 2024.

A significant proportion of small businesses, estimated at three-quarters, have not implemented enhanced cybersecurity measures to protect against threats and data breaches. Only 22% of respondents reported having bolstered their cybersecurity measures, the report found.

"Cybercrime is an ever-growing threat to Australian small businesses, and the alarming statistics in our latest report highlight just how vulnerable many are," said Gary Mandelkow, Chief Technology Officer of Localsearch.

"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 said.

Mandelkow continued, "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," he said.

Localsearch emphasises its commitment to providing small business owners with tools and knowledge to enhance their business resilience.

"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," Mandelkow added.

The data for this report was gathered from a sample of Localsearch customers, which includes Australian-based small to medium-sized business owners, between 17 September and 9 October this year. This report follows earlier iterations focusing on mental health and skill shortages among Australian small business owners.