This case study examines facility layout which concerns both manufacturing and service operations. Facility layout decisions consider how work areas and storage areas are arranged to minimise the costs of movement of people, materials, equipment and information between departments. There are several approaches to layout problems (activity matrices, string diagrams, flow diagrams, interrelationship diagrams, relationship charts etc.) but all are concerned with how to reduce costs to a minimum. There are different types of layout which a factory or service provider can use to produce a product or service and the layout chosen will depend upon the volume produced and the variety of products produced. Through worked examples and fully explained solutions, techniques of how to reduce costs by analysing facility layout are demystified. Aimed at students on operations management courses, the case presents several approaches to layout problems: activity matrices, string diagrams, flow diagrams, interrelationship diagrams, relationship charts). All are concerned with reducing costs to a minimum. The authors illustrate how facility layout decisions determine the arrangement of work areas and storage areas. This minimises the costs of movement of people, materials, equipment and information between departments. This case study also provides readers with step by step guidance to determining the optimum layout with the Adjacent Department Method.