In the increasingly competitive online market space, the wholesale B2B arm of\u00a0online grocery delivery startup BigBasket, Supermarket Grocery Supplies, has increased its overall losses by almost seven times reaching $96.35 Mn (INR 653 Cr) in FY17 from $14 Mn (INR 95 Cr) in the year earlier.\r\n\r\nAn ET report quoted the company\u2019s financials with the Ministry of Corporate Affairs to reveal that the company recorded a rise of 12% in its operating loss for FY17 which reached $46 Mn (INR 312 Cr) from $40.8 Mn (INR 277 Cr) in FY16.\r\n\r\nThe increase in overall losses has been attributed to \u201cfair value changed to the financial liabilities\u201d. \r\n\r\nSome of the major expenses that contributed to the company\u2019s mounting losses include employee benefit expenses of $20.5 Mn (INR138.9 Cr). \r\n\r\nFurther, BigBasket\u2019s B2B arm doubled its revenue to $173.60 Mn (INR 1,176 Cr) in FY17 from $83.10 Mn (INR 563 Cr) in FY16.\r\n\r\nBigBasket had registered two operating entities: Supermarket Grocery Supplies, the B2B arm which sources products and sells it to Innovative Retail, that runs the online grocery portal.\r\n\r\nInnovative Retail reported revenues of $160.92 Mn (INR 1,090 Cr) in FY17, a 107% jump from $77.8 Mn (INR 527 Cr) a year ago.\r\n\r\nLosses increased to $28.19 Mn (INR 191 Cr) when compared to a revenue of $15.25 Mn (INR 103.4 Cr) made in FY16.\r\nBigBasket Gaining Foothold\r\nRecently, reports surfaced that BigBasket is looking to raise $300 Mn \u2013 $500 Mn from Chinese conglomerate Alibaba and some other new investors.\r\n\r\nAt present, BigBasket has been taking a slew of initiatives to create market dominance with offline expansion as well. Inc42 had earlier reported that BigBasket plans to tap the offline market through kiosks that will stock fruits, vegetables, FMCG goods and other daily grocery items.\r\n\r\nTo this end, the Bengaluru-headquartered online grocery platform has already launched a pilot for its new offline service and has also built a separate app known as BB Instant.\r\n\r\nWith the aim of further bolstering its service, BigBasket is also looking to introduce a subscription programme for everyday essentials like milk, bread, etc.\r\n\r\nAdditionally, the Alibaba-backed Paytm was planning to integrate BigBasket on its platform as more than half of the orders on Paytm Mall belong to the grocery and FMCG categories; this integration is expected to increase Paytm Mall\u2019s orders to 60%.\r\n\r\nBigBasket offers about 20,000 products from over 1,000 brands and is present in 26 cities across the country, including Bengaluru, Hyderabad, Mumbai, Pune, Chennai, and Delhi. It offers express delivery of orders within 60 to 120 minutes.\r\nThe Booming Indian Grocery Industry\r\nEarlier, Inc42 had reported that Indian ecommerce major Flipkart has indicated its plans to launch grocery services in five cities by July. Flipkart\u2019s grocery operations would start in Hyderabad, followed by Chennai, Mumbai, Delhi-NCR, and Pune.\r\n\r\nBeyond the big ecommerce players, existing startups in the sector include ZopNow, Satvacart, Godrej Nature\u2019s Basket, Quikr, Grofers and DailyNinja, among others.\r\n\r\nGurugram-based online grocery delivery startup Grofers, which is present in 26 cities, is said to be in talks to raise $60-65 Mn in funding from Japan\u2019s SoftBank Group with Tiger Global Management\u2019s support.\r\n\r\nAs Amazon continues its tryst in India, Amit Agarwal, Amazon India head, shared that the company expects groceries and household products to account for over half of its business in the country in the next five years, as it moves to broaden its offerings in the segment and foray into areas such as fresh produce.\r\n\r\nAmazon opened 15 fulfilment centres to create a specialised network for Amazon Now, while its food retail plans have hit a roadblock.\r\n\r\nA report by Kalagato further revealed that as of March 2017, BigBasket held about 35% market share in the online grocery segment, closely followed by Grofers at 31.5%, and Amazon at 31.2%.\r\n\r\nAccording to a Goldman Sachs report, the Indian online grocery market is estimated to reach $40 Mn (INR 270 Cr) by FY19, growing at a CAGR of 62% from 2016 to 2022.\r\n\r\nMorgan Stanley expects the online food and grocery segment to become the fastest-growing segments in India, expanding at a CAGR of 141% by 2020 and contributing $15 Bn or 12.5% of overall online retail sales.\r\n\r\nWith Flipkart ready to enter the grocery market with Walmart\u2019s offline presence, BigBasket and other players need to be ready for the next level of disruption in the crowded and competitive grocery market.