Cybersecurity is a top concern for many small businesses, especially since internet-based operations are central to many of them. As cyberattacks grow more frequent and severe, some decision-makers weigh whether to outsource their IT security needs. That approach has both positive and potentially negative aspects to weigh.

Pro: Additional Cybersecurity Expertise

Many IT teams working for small businesses struggle to safeguard their employers from emerging threats. That issue can arise for various reasons, including the fact that theymay have fewer overall resources, resulting in cybersecurity professionals becoming overworked and potentially distracted.

Even well-resourced cybersecurity experts face numerous challenges, especially as the threat landscape becomes more diverse and attackers launch increasingly disruptive attacks. A 2024 study of small and medium-sized enterprises highlighted the extent of the problem.

It found 94% of respondents had dealt with at least one cyberattack. Additionally, 76% of participants lacked the in-house skills to meet all cybersecurity needs. Those findings are especially concerning since 78% of those polled believed severe cyberattacks could put them out of business.

Outsourcing allows clients to improve their cyberattack readiness much more effectively and quickly than by increasing the sizes of their internal teams. Parties providing external cybersecurity services partner with small businesses to address vulnerabilities and close skills gaps adversaries might otherwise target. Those pooled resources allow clients to adopt a stronger posture against cyberthreats.

Con: Increased Opportunities for Data Breaches

All outsourcing arrangements result in external parties working with client data. Such circumstances make it more difficult to verify that everyone is following best practices for protecting that information.

Some hackers specifically target third-party providers. A December 2024 federal case involved China-supported cybercriminals who infiltrated the U.S. Department of the Treasury’s workstations. They targeted an external cybersecurity service provider and stole a key used to secure a cloud-based tech support service.

This example illuminates how cybersecurity outsourcing can cause unintended consequences if external entities have vulnerabilities malicious parties exploit. However, that reality should not prevent the decision-makers at all small businesses from considering third-party assistance. A better approach is to learn how shortlisted service providers protect client data before selecting them. Asking detailed questions can help potential customers feel assured they are doing the right thing by outsourcing cybersecurity needs.

One thing to determine is if a security services provider will transfer client data to its outside partners or if that information will stay within the outsourcing enterprise’s control. Cybercriminals look for attack vectors, which are the entry points that enable data breaches, phishing attempts and more.

A greater number of parties handling corporate information is a potential risk because some incidents start with social engineering. However, leaders diligently verifying service providers’ cyberpreparedness mitigates risks.

Pro: Better Cost-Effectiveness Potential

Many professionals initially underestimate how much it will cost to safeguard their small businesses from cyberthreats. Labor, specialized tools, software upgrades and other essentials are all considerations for those who are making annual cybersecurity budgets.

Accurately calculating the likely expenses is challenging, especially for recently established firms or those seriously investing in cybersecurity for the first time. However, outsourcing can offer interested parties more control over finances. One study found 70% of business representatives interested in outsourcing considered price a primary objective.

Although the offerings vary by service provider, many entities specializing in cybersecurity outsourcing provide tiers and packages that give clients more control over their spending. Some also allow them to add or remove services as necessary, giving them flexibility if their budgets change.

Decision-makers considering outsourcing for cost reasons should get all the relevant information about third-party companies’ plans. Additionally, they must review contracts and determine whether it’s possible to customize the services purchased.

Another aspect to consider is cybersecurity service providers build their entire operations by providing specialized services. That focus gives them excellent existing resources and infrastructures to begin using immediately. In contrast, it could take a small business years to build similar internal networks, and it will likely cost much more than outsourcing.

Con: Less Organizational Knowledge 

Although cybersecurity service providers excel in providing tailored solutions to combat potential attacks, those external parties typically do not know as much about their clients as the internal teams. In-house employees may have specific knowledge about factors indirectly related to cybersecurity, such as the organization’s plans for the next year.

For example, perhaps those intentions relate to what the company sells, how it engages with customers or the markets in which it operates. In that case, there is a good chance some of those goals will impact the organization’s online infrastructure and presence to some degree. A strong background in how an enterprise operates can provide proactive knowledge from a cybersecurity standpoint because it familiarizes workers with internal processes that could elevate hacking risks.

Similarly, cybersecurity experts with current and in-depth organizational knowledge can see how certain changes may necessitate new data protection policies or other actions to improve security posture. However, these challenges should not necessarily discourage decision-makers who are thinking seriously about outsourcing their cybersecurity needs. That is especially true if they do not have enough skills and experience internally and are ready to change that.

According to a 2024 study, only 17% of respondents associated with small or medium-sized businesses thought they had somewhat effective or effective cybersecurity capabilities. Limitations on their time, expertise and budgets made improvements challenging. However, outsourced services could cost-effectively relieve many burdens.

Is Outsourcing the Right Choice?

Giving some cybersecurity responsibilities to an external company is a significant decision, and there is no universally correct choice. However, these are some of the primary positives and downsides of outsourcing. Reviewing them in the context of specific requirements and circumstances can help leaders make confident decisions to protect their businesses from attacks.

Having in-depth discussions with all shortlisted cybersecurity service providers is also valuable because it allows potential clients to learn about each option’s strengths and weaknesses and gives them time to make well-informed conclusions. Those who do decide outsourcing is the best option for them should always take time to understand all contractual engagements. That way, they will know the steps for ending a relationship if the services provided are less than expected.