IoT Security for Small Manufacturing: Protecting Connected Equipment Without Breaking the Bank

IoT adoption in small manufacturing has rapidly accelerated, with over 18 billion connected devices estimated worldwide as of 2025 (Statista - Opens in new window). Manufacturers now rely on smart sensors, networked controllers, and automated machines for everything from predictive maintenance to inventory tracking and real-time production monitoring. However, these innovations come with unique security pitfalls—especially for resource-limited operation teams trying to avoid costly breaches and downtime.

IoT Security Threats in Manufacturing

As threat actors shift from pure data theft to operational disruption, manufacturing is now one of the most targeted industries for IoT cyberattacks, with attacks increasing by 87% in 2024 (JumpCloud - Opens in new window). Risks include:

• Equipment hijacking: Unauthorized access can sabotage production or cause dangerous machine behavior.
• IP/data loss: Connected platforms can leak proprietary process data if left unprotected.
• Downtime: Attacks such as ransomware and botnets can halt production lines, resulting in major financial losses (median cost estimated at $125,000 per hour) (Oxmaint - Opens in new window).
• Safety risks: Compromised IoT devices may bypass safeguards, jeopardizing personnel and product integrity.

Conducting an IoT Asset Inventory

Security starts with visibility. List every connected device—including legacy controls, cameras, mobile sensors, and remote management platforms—on the factory floor. Document technical specs, firmware versions, and built-in security features. Map out data flows: which systems exchange information? Which devices send or receive data externally? Rank each device’s risk based on operational importance and exposure to external networks.

Cost-Effective Security Fundamentals

Even small manufacturers can deploy strong controls without heavy spend:

• Network segmentation: Isolate IoT equipment from business and guest networks to limit lateral attacks. See our previous blog post, Why Your Small Business Needs a Separate IoT Network (And How to Set It Up), for more information.
• Secure onboarding: Only allow devices onto your network after verification and configuration.
• Password management: Change all default credentials, use a password vault, and enable multi-factor authentication where possible.
• Firmware updates: Schedule regular patches, verify updates directly from trusted manufacturers, and maintain a log for compliance.

Monitoring and Anomaly Detection

Affordable monitoring is possible through simple network scanners, endpoint detection platforms, or managed security services. Establish “normal” behavioral baselines for all equipment to spot unusual traffic or device activity. Configure alerts for suspected breaches or deviations; integrate IoT monitoring with your broader security toolkit for complete coverage.

Authentication and Access Controls

Apply role-based access controls (RBAC) so only authorized staff can operate or configure devices. Use multi-factor authentication, especially for web dashboards or remote access. Secure vendor connections by rotating credentials and restricting remote access to authorized maintenance windows. Always log access attempts for auditing.

Security by Design for New Equipment

When buying new IoT devices, ask vendors about:

• Built-in encryption and authentication methods.
• Support for regular firmware updates and vulnerability disclosure.
• Contract language requiring adherence to your security standards and data handling expectations.
• Factor security maintenance costs—not just purchase price—into your total cost of ownership calculations.

Incident Response Planning

IoT-specific incident response should cover:

• Rapid disconnect procedures for compromised equipment or urgent threats.
• Role assignments: Who leads recovery, communications, and reporting?
• Plans for restoring production with minimal downtime—test these periodically.
• Documented steps for forensic investigation, including what data to preserve and report.

Check out our guide, Practical Incident Response Planning for SMBs: How to Prepare for the Inevitable, to learn more about incident response planning.

Case Study: Small Manufacturing Security Implementation

Many small manufacturing firms have seen measurable benefits from adopting practical, affordable IoT security. For example, a typical SMB manufacturing plant begins its security upgrade by first cataloging every internet-connected device, then implementing network segmentation to isolate equipment from its business systems. With simple password policies and low-cost monitoring tools, staff quickly reduce the risk of unauthorized access and detect abnormal activity before it causes operational disruption.

The implementation is carried out in phases—starting with high-risk assets and scaling as confidence grows. While challenges include adapting legacy machines and encouraging staff buy-in, the plant reports a significant reduction in attempted unauthorized connections and improved overall network visibility within a matter of months. These results are consistent with security improvement trends reported by many SMBs that focus on inventory, segmentation, and continuous monitoring.

Conclusion

A phased, affordable approach—starting with asset inventory and segmentation—can help small manufacturers defend their connected equipment, maintain uptime, and protect proprietary data. Long-term success means regular assessments, ongoing training, and keeping security front and center in new equipment decisions.

For hands-on help with manufacturing IoT security—whether it’s planning, vendor reviews, network setup, or rapid response—contact ExcalTech. Our experts specialize in practical, budget-conscious solutions customized for SMBs.

Get help today: schedule a free assessment with ExcalTech’s Managed Cybersecurity Team and take the first step toward securing the future of your manufacturing business.