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Data Loss: Advice for Small Business

March 27, 2023
Reading Time: 3 mins
Author: Ray Sweeney

As businesses rely more and more on digital technology, the risk of data loss becomes increasingly significant. Whether it's due to hardware failure, human error, or a cyber attack, data loss can be catastrophic for small businesses. That's why it's crucial for businesses to have a backup strategy in place.

In this post, we'll explore the leading causes of data loss and provide some key points that small businesses should be concerned about to protect their business.

The Leading Causes of Data Loss

According to various studies and industry reports, the leading causes of data loss include hardware or system malfunction, human error, software corruption, natural disasters, theft and cyberattacks. Hardware or system malfunction is the most common cause of data loss, accounting for around 45% of all incidents. Human error accounts for about 35%, with software corruption, natural disasters, theft, and cyberattacks accounting for the rest.

These statistics can swing quite drastically depending on the type of environments being surveyed. There has also been a large shift in recent years as physical hardware is reduced and more data is moving to the cloud.

Nevertheless, it's worth noting that the vast majority of data loss remains the result of malfunctions, corruptions and human error. The need for backup is not superseded by advanced cybersecurity or cloud technologies, it merely changes the approach taken & required software.

The Importance of Backups

Given the risk of data loss, it's essential for businesses to have a backup strategy in place. Backups allow businesses to quickly restore lost data in case of an incident. However, it's important to note that not all backup strategies are created equal. Businesses should consider implementing a backup strategy that includes regular backups, testing of backups, and offsite storage of backups.

In addition, businesses should consider implementing a 3-2-1 backup strategy. This strategy involves having at least three copies of data, stored on at least two different storage media, with at least one copy stored offsite. This helps to ensure that there are multiple copies of data available in case of a data loss incident.

Backups, Not What People Think It Is

"We're fine, we have a backup" is a phrase we hear all the time. Evidently, we find that on average 1 in 3 companies we onboard do not have a working backup. In most cases, these businesses have backups in place, and often even report successful backups occurring each day. Unfortunately notifications of a successful process completion does not guarantee a functional backup.

2021 study by Veeam found that data backup systems (particularly older ones), have limited rates of success. According to the study, on average:

  • Only 57% of backups are successful.
  • 39% of all restore jobs fail.
  • Combined, recovery of data will succeed only 35% of the time.

As jaw dropping as these statistics may sound to the uninitiated, they are commonly well within expected performance SLA's of backup software providers.

Similar reports reveal only 34% of companies test their backups and, of those who do, 77% have found failures. Common forms of failure include tape and drive failure (often without warnings), misconfigurations of backup, and data corruption.

What does this mean? It means that backup strategies need to have built in redundancy & regular testing in order to be effective. These factors are not common in the majority of SMB's even with outsourced providers and leaders should take warning.

Reducing Data Loss in Small Businesses

Small businesses are particularly vulnerable to data loss incidents, as they may lack the resources and expertise to implement robust backup strategies. However, there are several key points that small businesses can keep in mind to protect their business:

  • Regularly backup important data and test backups to ensure they can be restored successfully.
  • Implement a 3-2-1 backup strategy to ensure multiple copies of data are available in case of a data loss incident.
  • Train employees on best practices for data management and security to minimize the risk of human error.


Data loss is a significant risk for small businesses, but it's a risk that can be mitigated by implementing a robust backup strategy. By regularly backing up important data and implementing a 3-2-1 backup strategy, small businesses can ensure that they are prepared for a data loss incident.

In addition, by implementing cybersecurity measures and training employees on best practices for data management and security, small businesses can minimize the risk of a data loss incident occurring in the first place.

If you're concerned about losing your data, or would like to know more you can book in a brief chat with us. We would be happy to help evaluate your risk and point you in the right direction.


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