In this type of layout the machines of a similar type are arranged together at one place. This type of layout is used for batch production. It is preferred when the product is not standardized and the quantity produced is very small.
Advantages of Process layout:
• Lower initial capital investment is required.
• There is high degree of machine utilization, as a machine is not blocked for a single product
• The overhead costs are relatively low
• Breakdown of one machine does not disturb the production process.
• Supervision can be more effective and specialized.
• Greater flexibility of resources.
Disadvantages of Process layout:
• Material handling costs are high due to backtracking
• More skilled labour is required resulting in higher cost.
• Work in progress inventory is high needing greater storage space
• More frequent inspection is needed which results in costly supervision