The Cybersecurity Blind Spot: Risks in Vendor Relationships
When it comes to cybersecurity for businesses, size doesn’t matter in the way most would think. It’s not about how big a company is — it’s about how big their customers are. If a smaller organization processes sensitive data for large organizations, it is expected to protect that data with the same level of security as its biggest clients.
The Misconception: We’re Too Small to Be a Target
Many small businesses mistakenly believe they’re not on a hacker’s radar because of their size. They think, for example, “Why would anyone attack us when they could go after giants like Pfizer or major banks?” The reality is most cyberattacks are not specifically targeted — they are opportunistic.
Hackers often use automated tools to scan the internet for vulnerabilities in any public-facing system, regardless of the company’s size. They send thousands of emails to random email addresses they have gathered on the dark web. Its only after they gain access that they understand who they have compromised. For smaller companies, they investigate who the breached company works with, and that’s where the bigger fish come into play.
Just like law enforcement climbing the chain to catch a kingpin, hackers exploit weaker links in the supply chain to reach their ultimate targets. In fact, more than 50% of breaches occur through third parties. If hackers want to breach a company like Pfizer, breaking into a smaller vendor’s system is often the easiest and most effective route.
Why Hackers Target Small Companies
Hackers exploit small businesses as stepping stones to larger organizations for several reasons:
1. Lower Security Standards
Small companies often lack the budget and resources for intricate cybersecurity measures.
2. Vendor Relationships
As service providers to larger organizations, small businesses often have access to sensitive data that hackers can use to infiltrate more extensive networks.
3. Less Detection
Without advanced monitoring systems, smaller companies usually don’t realize they’ve been breached, often for months.
4. Human Error
Employees at smaller companies are often untrained in cybersecurity best practices, making them more susceptible to phishing and other social engineering tactics.
What Hackers Are After
Hackers don’t just target financial data. They’re after any information that can be sold on the dark web or used to exploit larger targets. This includes:
- Customer and employee records
- Bank account details
- Emails and passwords
- Payment card information
Even a one-person shop has valuable data worth stealing, and hackers know it.
Phishing: The Hacker’s Favorite Tool
Phishing causes over 80% of data breaches, making it one of the most common methods used to infiltrate small businesses. These attacks rely on unsuspecting users clicking malicious links or downloading harmful attachments, granting hackers access to their systems. Small businesses are left wide open to these types of attacks without regular employee training on how to spot phishing attempts.
Essential Cybersecurity Steps Every Small Business Should Take
No matter how big your organization is, you have a responsibility to secure your systems to protect yourself and your clients. Here’s how to get started:
1. Employee Training
- Regularly train employees to identify phishing emails and suspicious activity.
- Teach password best practices like using multifactor authentication (MFA).
2. Strong Password Management
- Enforce long (12 characters or more) passwords and MFA for all critical accounts.
- Use a password manager to keep credentials secure.
3. Regular Software Updates
- Ensure all systems, software and antivirus programs are updated.
4. Network Security
- Secure your Wi-Fi with encryption protocols like WPA3.
- Use firewalls to monitor and control network traffic.
5. Data Backup
- Back up critical data to a secure, offsite location.
- Test backups to ensure they can be restored effectively.
6. Access Control
- Limit access to sensitive data based on job roles.
- Use unique user accounts for each employee.
7. Third-Party Vendor Management
8. Incident Response Plan
- Create a clear plan for responding to cyber incidents, including data breaches.
Cybersecurity Measures Large Companies Should Take
Large companies must take active steps to protect their data and systems from breaches that can occur through small business vendors. Key measures include:
- Vendor Risk Assessment: Evaluate the cybersecurity practices of third-party vendors, identifying vulnerabilities in their systems, policies and employee training. Prioritize vendors with strong security measures.
- Contractual Security Requirements: Include specific cybersecurity clauses in vendor contracts, requiring practices like encryption, MFA, regular penetration testing and robust incident response practices.
- Continuous Monitoring: Regularly monitor vendor networks and data exchanges to detect and promptly address unusual activity or vulnerabilities.
- ISO 27001 or SOC 2+ Reports: Request third-party security attestations from vendors. These enhanced audits provide assurance that vendors meet stringent standards for security, availability and confidentiality, helping protect sensitive data.
By implementing these strategies, large companies can reduce risks and strengthen their defenses against supply chain attacks.
Cybersecurity is a Business Priority
No matter the size of your company, your role in the supply chain makes you a potential target. Hackers don’t see small businesses as insignificant; they see them as easy entry points. By investing in robust cybersecurity practices and fostering a culture of security awareness, small businesses can protect themselves — and their large clients — from becoming the next victim in a supply chain attack.
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