Groupon dissected. Merchant beware?

Here's a provocative POV on Groupon from TechCrunch - internet marketing company or small merchant loan sharking scheme?  

A few excerpts:
Groupon is not an Internet marketing business so much as it is the equivalent of a loan sharking business. The $21,000 that the business (up front) for running a Groupon is essentially a very, very expensive loan.  They get the cash up front, but pay for it with deep discounts over time.  Now here’s the crazy part.  Not only is Groupon effectively giving loans to merchants, but it also works the other way around.  The merchant is on the hook for the entire value of those deals until Groupon pays the merchant back its portion.  Unlike other loan providers, the merchant is making a short-term loan to Groupon. (Not technically, but effectively.) They buy inventory in advance of the Groupon run. They also serve the initial rush of customers. The business is in a hole before they get their 30- and 60-day Groupon payouts.


Even more interesting is the squeeze that Google Offers is putting on Groupon.
In (Groupon's payment terms), the first installment is 33% in 5 days. If they have to pay merchants faster, that could lead to problems.  And Google might force that to happen. According to Google Offers’ payment terms, merchants receive 80% of their share in 4 days—more than twice as much, 1 day earlier.  There’s no way that was an accident.  If Groupon matches these payment terms, they’ll need cash faster and need to grow faster.