Half off usually unaffordable products? Only $49.99 for that $100.00 dinner? That’s the magic of Groupon, but for some small business owners the “great business” offered by Groupon can be equal to the kiss of death. How could that occur?

The math of Groupon seems simple at a glance, but upon further inspection the numbers don’t add up when it comes to smaller businesses. A Groupon typically offers a 50% discount on a product or service, then the remaining profit is divided between Groupon and the small business. While Groupon has already received the profit in advance, the merchant is left waiting for their cut. Those worrying numbers are assuming the price cut is 50/50, which, in some cases, is being generous.

When you break it down to numbers, a Groupon deal seems disastrous, but it’s not only the numbers small business owners have to worry about. The point of Groupon deals is to attract new and hopefully long term customers. Yet, does this actually happen? The majority of consumers buying the Groupon are there for the bargain and don’t return after using their Groupon. CFHS Junior Angelita Pope stated, “I love the deals offered by Groupon! They can really save you so much money.” However, she went on to say that she hadn’t returned once to any of the businesses after using her Groupon.

For some small businesses, the pressure lies with the responses of their loyal customers, who watch as new faces get the same product or service for half the price that they have been paying for years. When you break it down, Groupon indicates that the business offering the deal is not only willing to be flexible with their price, but also that their product or service isn’t worth the price they’re charging for. When combining these factors, it’s no wonder loyal customers are put off by the idea of their favorite shop offering Groupons.

Now I by no means say Groupon have bad effects on all businesses; however the storm of Groupon is actually a disaster for a small business.

1.What is good about Groupon?

A. It can offer a large discount.

B. It helps add up the numbers.

C. It can improve the quality of the product.

D. It brings small business owners more profit.

2.CFHS Junior Angelita Pope’s statement suggests that _______.

A. small business owners needn’t worry about deals

B. people like using Groupon in the same business

C. the purpose of Groupon is to promote business

D. Groupon may not bring customers back

3.What does the underlined word “they” in Paragraph 4 refer to?

A. New faces. B. Loyal customers.

C. Groupon dealers. D. Small businesses.

4.What could be the best title for the text?

A. A new business trend—Groupon dealing

B. The development of a Groupon company

C. The effects of Groupon on small businesses

D. A fantastic shopping experience—Groupon

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