By Joy Beland

The numbers won’t lie, so we’re making an effort to help you calculate them.  Let’s take some baselines for your business to determine what the cost is for your network to be down.  This assumes you have no access to the server or the internet, and it affects your entire company.

Firstly, take the average salary of your employees.  It can be ballpark! Don’t get bogged down in the details.  For example, you have fifteen employees that average \$60,000 in salary.

\$60,000

Now, ballpark your fully-burdened rate.  This takes into account the following as they might apply to your business.  I’m using 85% of the salary as my estimate.

1. Employer taxes – 20% in California
2. Workman’s Comp insurance \$500 per year each person
3. Benefits:
1. Paid vacation time (one week)
2. State mandated sick pay 2.5 days
3. Paid holidays (7 days)
4. Health insurance contribution \$180 per person per month
5. Costco Membership
4. Certification Training
5. Licensing
6. Equipment

\$60,000 x 85% = \$55,250.  Total \$115,250 for salary for one person.

Number of work hours in a year = 40 x 52 weeks = 2,080

Fully burdened salary \$115,250 divided by number of work hours in a year 2,080 = \$55.41 per hour.

Now multiply that by the number of employees you have (15) = \$831.15 per hour.  So this is the cost of downtime in my example of a business with fifteen employees, per hour.

If we take a broader view of this we see that in one 8-hour day, it will cost me \$6,649.20 to be down for a day.

So that is the number I have in mind when I am figuring my backup (onsite and offsite) spend.  Is the solution being proposed going to save me from being down for more than an hour in any given disaster?

Let’s say there is a physical backup server being proposed:
\$2,500.

The solution is being billed out at \$400/month for onsite & offsite backup.  That’s \$4,800 per year.  So over the span of the first year, I am paying:

\$2,500 for the server itself
\$4,800 for the solution

\$7,300 total.  If my cost of down-time for one day is \$6,649.20, then the solution would basically pay for itself in one day, in the case of a full outage.  Keep in mind, this scenario does not include the lost revenue. Only you can calculate that, based on your business model.

Why is this such a big deal?  We watch the constant flow of new reports, and dollar figures, associated with cyber-crime.  72% of businesses hit with Ransomware or a similar data breach are down for 3+ days.  In our example, that is \$19,947 in costs for your staff and that does not include the lost revenue.

Interested in having us help with the calculation of your down-time cost?  Call or email us and we’ll schedule a free 15-minute call to walk through what the numbers would mean to your business.  That’s all it takes to get some pretty good ballpark numbers.  Then you can decide for your own business if it makes sense to buy cyber liability insurance, implement a backup and disaster recovery appliance solution, or both.