The Rs 45,000 crore (Rs 450 billion) Tata group is weighing the option of foraying into the logistics business as part of its diversification plans.

Tata Industries, the group's holding company for new generation businesses, is drawing up the blueprint.

Senior Tata group executives said, "Logistics is one of the areas the group is seriously looking at getting into. However, we are yet to take a final decision."

If the group gives the go-ahead, the House of Tatas would be yet another large corporate jumping into the logistics business bandwagon.

Others, in recent months, who have announced plans are Reliance, primarily to service their mega oil-retailing plan, and the Mahindras.

The gameplan is to form a separate company and bring the entire logistics of group companies under one umbrella.

The move would lead to better scale of operations and better services, and hence would help in considerable savings of cost.

Apart from group companies, the logistics company would provide complete supply chain management solutions to other companies also.

Tata Strategic Management Group has been advising the group on the new initiative to play a role of a third-party service provider. The concept has been placed before Tata Industries.

Industry sources said, on conservative terms, companies generally spend around 5-8 per cent of its turnover on logistics. So, for the Tatas, the new venture provides tremendous potential for growth, Tata executives added.

According to analysts, managing the supply chain -- from the manufacturer to the end-user -- forms one of the most essential part of the business cycle.