FRANZ DESIGN, a Portlaoise company set up 11 years ago, was an early adopter of e-commerce, to the point that online orders came to account for 20% of annual sales. Last year, however, web orders started to fall off worryingly.

“All of a sudden people became increasingly concerned about security and the number of online orders started to drop,” said Franz Caffrey, the company’s founder. “Customers began ringing to say they really didn’t want to leave their credit card details on our secure server.”

The development forced Caffrey to rethink the way the company carried on its online business selling handcrafted wooden pieces. Providing top-notch goods and a first-rate service isn’t enough. To succeed you must also provide top-level security.

Caffrey redesigned the company’s online facility to provide dedicated websites for both his American and European customers.

He also took the opportunity to outsource commercial transactions to PayPal, a secure payments specialist. Owned by eBay, the company is recognised by banks and, crucially, consumers around the world.

The move did the trick. “It has given consumers a lot more confidence in buying online, and at the end of the day the internet business is based on trust,” said Caffrey. “Whatever it takes to build customer confidence, that’s what I have to do.” Consumers are increasingly aware of the risks of cyber-crime “either because they’ve been stung themselves, or because of the massive media coverage about it”.

Central to the rise in cyber-crime has been the spread of spyware, software programs that lodge surreptitiously in a computer and transmit data to a third party.

Some of the spyware programs are highly sophisticated. UK police recently foiled the attempted theft of £220m (€322m) from the London branch of a Japanese bank. Having gained access to its computer network using spyware, the hackers attempted to transfer the money electronically to bank accounts around the world.

Britain’s National High Tech Crime Unit, which cracked the case, now reckons more than 80% of companies in Britain have fallen victim to some form of computer crime.

In Ireland, the IT firm MJ Flood Technology believes small firms are particularly vulnerable, largely because they are ignoring basic security steps and leaving their networks exposed to a range of spyware-enabled activities.

James Finglas, sales director of MJ Flood, said: “Spyware has evolved from an occasional nuisance to something far more sinister. A new generation of more sophisticated spyware is being targeted at organisations with the objective of stealing sensitive corporate data such as banking information or credit card details.”

But while large companies routinely protect their networks from such malicious internet traffic, small companies show a “bewildering reluctance” to improve their computer security, he said.

If a lack of money for in-house IT expertise is the primary cause, it may be a false economy. One company experiencing difficulties with its computer system recently contacted MJ Flood for a network audit. It revealed that the significant computer network downtime it was experiencing was the result of illicit software in its system. The network subsequently crashed and remained down for eight days.