Difference Between Product Layout and Process Layout (With Table)

With the initiation of a production unit comes the need to plan and organize the production process thoroughly, based on its suitability to our project, and its costs. These plans and structures come under the Operations Management field.

There are two major ways to lay off the layout, the Product Layout, and Process Layout. It is crucial to understand these concepts and to draw a clear line of distinction between them.

Product Layout vs Process Layout

The main difference between product layout and process layout is that Product Layout is one in which the machines are set up systematically such that the output of one machine is the input of another machine while Process Layout is one in which machines are set up at different locations, a variety of products can be produced by altering the order of these processes


Comparison Table Between Product Layout and Process Layout (in Tabular Form)

Parameter of Comparison

Product Layout

Process Layout


Product Layout is one in which machines are set up in order of procedures required to produce a particular kind of product.

Process Layout is one in which machines are set up at different locations to produce a wider variety of goods.


This layout is suitable when continuous and large scale production of similar goods is to be carried out.

This layout is suitable when small scale and altered goods are to be produced, in accordance with the customer’s choice and order.

Material Handling

Material Handling Costs are negligible because the output of one machine is the input of another machine and no transportation is required.

Material Handling Costs are very high because the material has to be transported to various departments.


No inventory is required to continue production.

High Inventories are required because of discontinuous production.

Space Required

Small space is required and that is fully utilized because machines are kept one after another in order.

Either a large space or different locations are required to set up different departments.

Skills Required

Workers don’t require any specific skill set. They can work on any machine in the entire space.

Workers need specialized skills to operate specific machines.


The process is rigid, it can’t be expanded or shortened. If one machine breaks down, the entire process is disrupted.

This layout is more flexible and allows easy altering of processes whether it be skipping or expanding


o   Efficient Supervision
o   Large Scale Production
o   Simple and less Paperwork
o   Low Skills required

o   Flexibility
o   Consumer-based production
o   Specialization
o   Effective even during the breakdown


What is Product Layout?

Product Layout is a method of operations management, that is, a method of organizing and setting up machines and layout of the steps to produce a particular product or a group of very similar products. In Product Layout, the machines are set up in accordance with the steps and procedures involved in the production of a good.

The machines are put in systematic order such that the inputs of a machine are the outputs of the previous machine. A line or chain of machines is formed which enhances the material handling Processes.

This type of layout is recommended when production has to be a continuous process because it helps us avoid material handling costs and ensures a smooth flow of production. Also, because the machines are kept together in one place, supervision is less cumbersome and space and resources are optimally utilized.

The system is suitable for industries like cement, steel, sugar, metal extraction, etc. However, the system is very rigid and the layout breaks down even if one machine breaks down because the chain gets disrupted.

A variety of products can’t be produced because the layout is laid out keeping in mind, only one product.


What is Process Layout?

Process Layout is also a type of operation management tool. In process layout, different machines that perform different functions or tasks are set up at different locations.

In process layout, specialized machines are set up at one place to perform certain tasks and similarly, other machines are set up at other places. These machines can be used in the different or the same order to produce a variety of goods while the processes are done separately.

It is suitable when small scale altered goods are to be produced on consumers’ individual preferences. The process is discontinuous and involves very high material handling and inventory maintenance costs.

It helps in the specialization of equipment and the labor and allows them to function to their full potential. This system is very beneficial because of flexibility, any of the processes can be easily skipped or expanded.

Even during the breakdown of any machinery, the procedure doesn’t stop. 

Main Differences Between Product Layout and Process Layout

  1. Product Layout refers to arranging machines in the sequence of production while Process Layout refers to setting up of different processes in isolation of each other.
  2. Product Layout is suitable in case of large scale production of similar goods while Process Layout is suitable in case of small scale production of a variety of goods.
  3. Costs of Material Handling and Maintaining Inventory are higher in Process Layout as compared to Product Layout because of discontinuity of production under Process Layout.
  4. Product Layout ensures efficient utilization of even a very small space while Process Layout requires large space or many different places.
  5. Product layout is more rigid and expansion isn’t possible while the process layout is very flexible, it can skip or expand processes and can also survive a breakdown of machinery.



When we start production of any good, the procedures’ layout and organization are a must. While managing operations, we are faced with a choice between Product Layout and Process Layout.

Product Layout is a type of layout that sets up a chain of machines based on the procedure to produce a particular good while Process Layout is one in which specialized machines are set up under various departments and production takes place by undertaking those processes in various and altered orders.

Product layout is suitable when continuous production, a higher degree of supervision, and less variety of goods is required. Process Layout is suitable when small quantities have to be produced, while also altering the products based on customer’s choice.


  1. https://dl.acm.org/citation.cfm?id=935090
  2. https://www.spiedigitallibrary.org/conference-proceedings-of-spie/9424/94241C/Predictability-and-impact-of-product-layout-induced-topology-on-across/10.1117/12.2085283.short