CMMC deadlines are approaching fast, and your contracts depend on getting certified. Your first question is probably: "What will this cost my business?"
You're not alone. Thousands of defense contractors are asking the same thing. Some companies spend $50,000 while others spend $500,000 or more.
The worst part? Many companies run out of money halfway through. They start CMMC thinking it will cost a certain amount, then discover it costs much more.
Why Poor Planning Creates Budget Disasters
Most defense companies underestimate costs significantly. They think CMMC will cost much less than it actually does. The government estimates all companies will spend $4 billion a year to follow the requirements.
Here's what happens when you don't plan properly:
• You lose contract opportunities while scrambling for additional funding
• Competitors with CMMC certification win your deals
• You must spend emergency money to keep current contracts
Good news: You can predict CMMC costs ahead of time. You just need to understand what drives expenses.
How Much CMMC Costs by Company Size
Small Defense Companies (Under 100 employees): • $30,000 to $150,000 total investment
Medium Defense Companies (100-999 employees): • $100,000 to $500,000 total investment
Large Defense Companies (1,000+ employees): • $500,000 to $2,000,000+ total investment
The Five Major Cost Categories
1. Initial Assessment and Gap Analysis (10-15% of budget)
Every CMMC project begins with evaluating your current security posture. These assessments cost $10,000 to $20,000 for most companies.
2. Technology Implementation (40-50% of budget)
Technology upgrades represent the largest expense. Companies need endpoint monitoring, data encryption, access controls, and backup systems. Most organizations spend $50,000 to $300,000 on new technology.
Essential technology requirements:
• Multi-factor authentication systems
• Endpoint detection and response tools
• Security monitoring and logging platforms
• Data backup and recovery solutions
3. Third-Party Assessment Costs (15-20% of budget)
The Department of Defense estimates Level 2 assessments will cost $105,000 to $118,000. Level 1 requires only self-assessment, so costs remain lower.
Assessment expenses include:
• $15,000 to $50,000 for the actual audit
• Assessor travel expenses
• Internal staff time during the evaluation process
4. Documentation Development (10-15% of budget)
CMMC requires extensive written security policies and procedures. Your team or consultants must develop comprehensive documentation. Expect $25,000 to $75,000 for complete documentation packages.
5. Ongoing Maintenance (20-25% yearly)
CMMC costs continue after certification. Plan for $10 to $50 per endpoint monthly for continuous monitoring services.
Hidden Costs That Catch Companies Off Guard
Employee Training Requirements
Your team needs comprehensive security training. Human error causes 74% of security breaches. Plan for 40-60 hours of training per employee who handles sensitive data.
External Consulting Support
Most companies need outside expertise. Small to medium companies spend $5,000 to $20,000 on initial readiness activities alone.
Operational Disruption
New security measures temporarily reduce productivity. Plan for decreased efficiency during the transition period while staff adapts to new procedures.
CMMC Level Requirements and Associated Costs
Level 1: Basic Cyber Hygiene
• Self-assessment only
• Government estimates $3,000 to $5,000
• Protects Federal Contract Information
Level 2: Intermediate Cyber Hygiene
• Third-party assessment required
• Most defense contractors need this level
• Protects Controlled Unclassified Information
Level 3: Good Cyber Hygiene
• Government assessors conduct evaluation
• Advanced security requirements
• Highest implementation costs
Strategic Approaches to Control Costs
Accurate Scope Definition
Determine exactly which systems handle sensitive information. CUI enclaves cost $300-$400 per user monthly but may reduce overall compliance scope.
Leverage Existing Infrastructure
Many companies already own some required security tools. Audit current technology before purchasing new systems when possible.
Phased Implementation Strategy
Avoid attempting everything at once. CMMC compliance can take 12-18 months when distributing costs and managing cash flow effectively.
Managed Security Services
Outsourcing security operations often costs less than hiring full-time cybersecurity staff. Managed service providers offer 24/7 monitoring at predictable monthly rates.
Return on Investment Considerations
CMMC certification enables access to valuable defense contracts. Companies report winning more contracts after achieving certification. The investment usually pays for itself within 2-3 years through increased business opportunities.
Extra benefits include:
• Higher contract win rates
• Premium pricing for enhanced security capabilities
• Competitive advantage over non-certified competitors
Next Steps for Your Organization
Don't let CMMC costs surprise your budget. Begin with a gap assessment to understand your expenses. Then, develop a realistic timeline and budget based on your specific requirements.
Successful companies treat CMMC as a business investment rather than a regulatory compliance.
They plan carefully and use certification as a competitive differentiator.
Ready to understand exactly what CMMC will cost your organization? Contact Prescott today for a cost assessment.
