Is Groupon a raw deal for business owners?

We've heard a number of horror stories, so we wanted to see if these were the exception or the norm.

We also wanted to find out if businesses are burning out on Groupon...just before the company hits the public markets.

(A former daily deals salesperson says customers are wising up and that the going will be much tougher for Groupon, et al, going forward.)

If Groupon's growth has been driven by curious businesses just trying the service once, the growth is obviously unsustainable. And Groupon has not yet released any information about repeat customers.

So we conducted a survey of small business owners who have actually offered Groupons to find out what they think of the service. We got 16 verified responses from business owners who have dealt with Groupon. This is obviously not a comprehensive pool, but it provides an interesting snapshot of what some companies think of the service.

The key takeaways from our survey:

About 60% of businesses considered their Groupon experience a success, but more than half of customers do NOT want to run another Groupon. Almost 40% of Groupon customers, meanwhile, thought their experience failed.

Groupon was not a better service to work with than its rivals.

Most businesses said only "a handful" of Groupon buyers became repeat customers, suggesting that Groupon is not as effective a customer acquisition tool as people think.

Half of the businesses polled said they would NOT recommend Groupon to another small business. The other half would.

For our complete results continue reading ...