PLANT LOCATION AND LAYOUT OF AN INDUSTRY

N.SANTHI PRIYA MPHARM,

Asst.Professor
Chalapathi institute of pharmaceutical sciences
• Plant location means the establishment of an industry at a

particular place

• It is a function of determining where the plant should be

located for maximum operating economy and

effectiveness.

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 Importance of plant location

1 Cost
• Investment cost
• Partially determines costs .
2 Physical factors
• Heating
• Ventilating requirements
• Storage capacity of raw material
• Power needs
• Cost of labours
• Taxes
• Land construction , fuel, etc
3.Goverment rule : choice of location keeping national benefits.

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 Factors influencing a plant location choice

• Location should achieve Minimum cost of production and

distribution
• Factors:
1. primary[Fundamental factors]
2. Secondary [derived factors]

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 Fundamental or primary factors

 Raw materials
 Market for products
 Energy availability
 Transportation facility
 Labor supply

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• Raw materials: crude drugs,inorganic chemicals, organic chemicals
• Locate a plant nearer to the source of raw material-economical
• Market for products: bulk materials ,plant location should be at the
primary market
• Energy availability: fuel and power
• Transportation facilities: railway,road,seaport
• Labour supply: skilled labour –in pharma industry

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 Derived [secondary] factors
 Climate and soil
 Government concession
 Water supply
 Waste disposal
 Site characteristics
 Flood and fire protection
 Community factors

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Climate and soil
• Usually operations are performed in controlled humidity , dust free and ai
rconditioned rooms
• suitable cultivation of medicinal plants
• Antibiotics production –low microbial contamination in the environment
Government concessions : tax concessions for industrially backward areas
Water supply
 Liquid orals- water for cooling,washing,steam generation
 Temperature,mineral content,bacteriological contents,supply cost
purification methods are considered

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Waste disposal: Effluent treatment systems,Facility for handling of waste disposal
methods
Site characteristics: Land costs , Construction costs , living conditions , future
expansion
Flood and fire protection:
 Immediate assistance from fire department incase of fire hazards
 Regional history of floods or natural events are to be checked

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 Selection of site

It should be
 Connected with rail , road and river transports .
 Efficient sewage system for the disposal of water and waste materials
 Surroundings: - good and peaceful
 Sub-soil :- capable of bearing the load of building plant and equipment.
 Sufficient land space requirements for the parking of transport and
sufficient space for the residential accommodation for the staff and labour

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 Selection of site

Urban areas Rural areas

Provide better transport and communication system

with sufficient labor supply and also social services
like medical , entertainment, restaurants , educational
etc .
but in urban area , cost of land and labor wages are
likely to be on higher side
Provide cheaper land and labor with scope for
further expansion , good shopping complexes,
entertainment facilities , school and colleges
and In general , rural location is good for large
plants.

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 PLANT LAYOUT
Layout of Building And Equipment
Product And Process Layout

N.SANTHI PRIYA MPHARM,

Asst.Professor
Chalapati institute of pharmaceutical sciences
 CONTENTS

 Plant layout
 Objectives of a good layout
 Importance of plant layout
 Factors influencing layout
 Types of layout
 Process layout –adv and disadv
 Product layout- adv and disadv
 Merits of product and process layout
 Procedure in layout planning and design

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 PLANT LAYOUT

A plant layout is a floor plan for determining and arranging the physical facilities
like

-desired machinery and

-Equipment

-Furniture within a factory

to permit the quickest flow of material at the lowest cost and with the least amount
of handling in processing the product from the receipt of the raw materials to the
shipment of the finished products

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 Objectives of a Good layout

• Proper and efficient utilization of available floor space

• Reduce material handling costs

• Provide ease of supervision and control

• Allow east of supervision and control

• Allow east maintenance of machines and plant

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 Importance of plant layout

• An ideal plant layout should provide the optimum relationship among output , floor area and
manufacturing process

• Flexibility of operation

• Easy production flow

• Make economic use of building

• Promotes effective utilization of manpower

• Employees convenience

• Safety comfort at work

• Maximum exposure to natural light and ventilation

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 Importance of plant layout

• Plant layout provide the optimum relationship between output , floor area and
manufacturing process .

• Facilitates production process :To minimize material handling, time and costs,
and flexibility of operations , easy production flow , makes economic use of the
building , promote effective utilization of manpower and provides for employees
convenience , safety , maximum exposure to natural light and ventilation.

• It is also important because it affects the flow of material and processes , labor
efficiency , supervision and controls , use of space and expansion possibilities etc .

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 Factors influencing layout

 Materials
 Product
 Worker
 Machinery
 Type of industry
 Managerial policy

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Materials : need to provide storage and movement in proper storage rooms
and handling equipment
o Type of raw material
o Availability or scarcity of materials
• Layout-To visualize the paths of materials flow or movements
Product
• type of the product
• Size of the product
• Position in relation to plant location
Workers :type,position and requirements of employees
• Employee facilities like health ,feeding,locker rooms,public facilities and
safety receives due consideration in layout
Machinery –volume of production,type of process,type of product determines
the size and type of machinery

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Type of industry
• Synthetic
• Analytical
• Conditioning
• Extractive
Location :
• Size and terrain of the site
• Mode of transportation from source of raw materials to market
• Fuel requirement
• Storage of fuel and power generation
• Future expansion
Managerial policies :
Volume of production and provision for expansion
Extent of automation
Making or buying a particular component
Desire for rapid delivery of goods to customers
Purchasing policy
Personnel policies

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 Types of
layout

Product Process Fixed position Combined or

layout layout layout group layout

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 PRODUCT OR LINE LAYOUT

• Defined as the arrangement of machines doing various operations in a line as one

department.

• All the machine tools or other items of equipment must be placed at the point
demanded by the sequence of operations

• Machine and equipments are arranged in one line.

• The materials move from one workstation to another sequentially without any
backtracking or deviation , sequence arrangement of operations required for the
product.

• Materials are fed into the first machine and finished goods travel automatically
from machine to machine , the output of one machine becoming input of the next

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 Advantages

• Low cost of material handling

• Avoids production bottlenecks
• Lesser investment in inventory, inventory in finished goods is less
• Optimum use of floor space
• Shorter processing of work in the process
• Lower cost of manufacturing per unit
• Smooth and continuous operations
• Simple and effective inspection of work
• Incentives to workers to raise the performance level

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 Disadvantages

• Higher initial capital investment in special purpose machine ( SPM )

• Any Breakdown of equipment then the whole production process stops.

• Suitability mass production of standardized products

• Lesser flexibility of physical resources

• Expansion is difficult

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 PROCESS OR FUNCTIONAL LAYOUT OR JOB SHOP LAYOUT

• In this type, all machines of a particular class doing a particular type in

work are arranged together in a separate department

• The distance between departments should be as short as possible for

avoiding long distance movement of materials

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 Advantages

• Lower investment on machines

• Effective inspection and supervision

• High scope of expansion

• Better utilization of men and machines

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 Disadvantages

• Difficulty in moving of materials

• Requires more floor space

• Accumulation of work –in-progress

• Production time is more

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 MERITS OF PRODUCT AND PROCESS LAYOUTS

PRODUCT LAYOUT PROCESS LAYOUT

Mechanization of material handling Reduction in equipment investment

Avoidance of bottlenecks Flexibility in production

Economy in manufacturing time Efficient supervision possible

Better production control Scope of expansion

Less floor area Utilization of men and machines

Minimum investment in work-in-progress Easy to handle breakdowns

Incentives to workers group Incentives to individual worker

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 Differences between product and process layout

Product layout Process layout

Machines are arranged as per the According to process
products
Present in a sequential order Not present
Raw materials never return to the process Never return
Materials handling costs can be reduced Increases
Automized Difficult to automize
Different machines for different products Same machines for different products
Large amount of capital investment Small amount
Only standardized products Different design

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 PROCEDURE IN LAYOUT PLANNING AND DESIGN

Processing area Handling area Storage area

Identification
Equipment layout in a unit

Processing unit

Structural layout

piping layout

Electrical layout

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 Information needed to design

• Work place dimensions

• Sequence of operations

• Flow pattern of materials

• Storage space of raw materials , in-process inventory and finished products

• Space for offices,aisles,toilets etc

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 Layout analogues

Layout analogues are dimensional cutouts and 3d models .They are

 Templates

 3d models

 Correlation charts

 Travel charts

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 Drawings of a plant layout

Scale drawings with elevation for equipment and

process

Analysis of layout

Detailed drawing

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PHARMACEUTICAL PLANT LAYOUT
Sterile or Aseptic Area Layout
Tablet Production Area Layout

N.Santhi Priya,Mpharm
Assistant Professor
Chalapathi Institute of Pharmaceutical sciences,Guntur
Flow Of Materials Through The Production Department

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Changing room before entering aspetic
area

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 Changing room classification

Black area
Normal protective garments(lab coats) are removed
Grey area
Hands are scrubbed and donning of protective garments
White area
over boot and sterile gloves are put on

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Sterile Product Unit Layout

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Transfer hatch
or pass box

Secondary
Viewing panel dressing
Step-over barrier

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Tablet Production Area Layout

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Centre storage and perimeter production

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Storage and production side-by-side

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Straight line type or parallel type

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TABLET PLANT PRODUCTION LAYOUT

N.Santhi Priya,Mpharm
Assistant Professor
Chalapathi Institute of Pharmaceutical sciences , Guntur
 CENTRAL STORAGE AND PERIMETER PRODUCTION

The center of the facility is a storage of warehouse area for raw materials, packaging

components and bulk stocks, with the manufacturing and packaging operations

located at the outer perimeter.

• Advantage : It has the advantage of space conservation by virtue of having

the supply areas close to the areas being supplied.

• Disadvantage : A significant disadvantage is the crossover traffic pattern of

materials , with the ensuing potential for contamination or mix-up

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 FLOW OF MATERIALS

Receiving and quarantine

Tablets in quarantine Bulk stock
areas

Approved storage Packaging Packaging

Delivered to approved
Dispensing Manufacturing area
storage area

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 Circular flow

• 2 sides across a central corridor

Advantage : Owing to the modified layout, the flow is basically circular,

eliminating much of the crossover traffic present in the perimeter layout.

Disadvantage :

• Though much of the crossover traffic is eliminated, chances of

contamination are still significant enough.

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 Straight line flow

• It consists of a basic straight line flow to minimize contamination or mix-

up, moving the materials along a critical path.

Advantage : The principal advantage over the layouts is minimal cross-over of

materials , thus minimizing the potential for contamination or mix-up.

Disadvantage : The additional space required to accommodate this

configuration

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 References
1. Pharmaceutical dosage forms:Tablets volume 3,2nd edition,edited by herbert
A,liberman,Leon Lachman,joseph B schwartz,chapter 6
2. Pharmaceutical facilities-design,layouts and validation Manohar A Potdar,pg 107-
142

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Drug store location and selection of
premises

N.Santhi Priya,Mpharm
Assistant Professor
Chalapathi Institute of Pharmaceutical sciences,Guntur
 Contents
PART -1
Drug store location
PART-2
Selection of premises
PART-3
Drug store management
 LOCATION

Geographic Specific Functional

Depending on the
Depending on
Rural Urban the
scope of
commercial suscipient
Intercep
Generative
characteristics tive
functions

Major
Central Neighborhood or
outlying Shoppin
business sub urban
retail g centers
district residential
districts
locations
Rural location
• Facility of loan from financial institutions from rural
development quota
• Good sale of products like pesticides, insecticide, insect
repellants and veterinary medicines can be expected
Urban areas
• Good market potential for a drug store
• Good transport facilities quick delivery of medicines for the
store so as to run smooth business
• Suppliers extend credit facility help for establishing new store
• Due to better living standards good sale of cosmetics ,costly
medicines are possible
Suscipient location
• A location where customers are attracted as a matter of chance or on
impulse when they are away from homee.g: a drug store located in clinics
and hospitals

Interceptive location
• Location falls on the way to a shopping centre

Generative location
• A location where customers are attracted and hence good business can
be generated
• Eg: drug stores in small cities,rural towns
Central business district
• It is an area which shows high concentration of retail business
,offices,theatres,high traffic flow

Major outlying retail centre:

• A combination of retail store located in a urban area with central business
district
• Residential neighborhood or suburban location
• Serves the residents with an immediate area approximately a mile radius
• Shopping centre
• Particular modern design attracts and made accessible to customers with
wide variety of services
 Factors affecting the selection of site for a drug store

o Business locality

o Thickly populated residential areas

o Developing areas

o Hospitals

o Flow of traffic

o Parking

o Drug store

o Near to hotels,schools,theaters
 Acquisition of premises for a drug store

• The premises for a drug store may be taken on rent or on lease for a certain period
or purchased directly
 On rental basis- legal written agreement about rent,period of possesion,actual use
of shop premises
 Lease – can be renewed after the expiry by mutual agreement with the owner
Precautions to be observed by the pharmacist:
• Note down the date of occupancy
• Payment time of the installments
• Comply with the local rules
Layout of A Drug Store
 Objectives of GOOD LAYOUT DESIGN

• Reduction of the running expenses and hence he cost

• Proper utilization of available floor area to the maximum

• Possibility of activating all corners of the drug store

• Provision of adequate protection to medicines

• Better supervision of the stores

• Convenient location of the medicines

• Controlled traffic pattern within the store

 Legal Aspects of A Drug Store

1. Minimum qualification
2. Minimum space
3. Store arrangements
4. License
1.Qualification :
 Retail-
• Registered pharmacist in state pharmacy council
• Qualification to get registered is a diploma in pharmacy from a recognized institution
 Wholesale-matriculation with 4yrs experience in selling drugs in a chemist shop + registered
pharmacist
 Person with sufficient capital can also start by appointing a registered pharmacist
2.Space:
Minimum desirable area to open
 Retail store -10 sq.mt
 Wholeale-10.sq.mt
 Retail+wholesale – 15 sq.mt

3.Stoage arrangments :

• Sufficient number of racks to store drugs and pharmaceutical preparations

• A refrigerator to store vaccine, sera, enzymatic preparations , vitamin products

4.License
Documents required to open a retail drug store &Wholesale drug store
Documents required for the renewal of a retail drug store and wholesale drug store
 Drug store management

1. Drug selection process

2. Procurement of drugs

3. Drug distribution

4. Preparation of drug store

5. Ordering supplies

6. Receiving supplies

7. Organizing supplies and storage

8. Record keeping
 Drug selection steps
1. Listing of common health problems
2. Review standard treatment options
3. Develop National guide lines
4. Develop list of Medicines (Essential drug list )
5. Rationalizing use
 FACTORS FOR DRUG SELECTION CRITERIA

 Cost and dosage form that are affordable making it cost-effective in view
of the maximum use of resources
 Availability of drugs for majority of illnesses
 Availability of safe, efficacious and cost effective drugs
 National Health policy (Free/ subsidized drugs )
 National Drug policy (Pricing and production)
 Cost recovery/ sharing
 Procurement of Drugs
State of Andhra Pradesh (AP)
The nodal agency for purchase of drugs in AP is the Drug Procurement Wing of the Andhra Pradesh
Infrastructure State Development Corporation (APISDC).

Key features of APISDC

o A centralized pooled procurement system

o Suppliers of repute, and following GMP

o Discourages quoting of unreasonably low rates in their bids to be included in the rate contract

o A notified committee draws the selected list for procurement

o Rate contracts are finalized on the selected list of drugs centrally by another notified committee.

o Indents are collected from hospitals and consolidated by the nodal agency and orders are placed before
the firm to make the delivery to the medical stores in each district
 Drug Distribution
A well-managed distribution system should:
 Maintain a constant supply of drugs
 Keep drugs in good condition
 Minimize drug losses due to spoilage and expiry
 Rationalize drug storage points
 Use available transport as efficiency as possible
 Reduce theft and fraud
 Provide information for forecasting drug needs
 Preparation of drug store
The drugs and medicines including kits are expensive and sensitive to changes
in temperature and need to be kept under ideal conditions to avoid
deterioration.
Location: It must be accessible to all customers and there should be provision
for vehicles bringing the supplies directly to the store.

Shading: Locate the store in an area where trees can be planted to provide
shade and offset high temperatures

Drainage: Build the store on a raised foundation to allow rainwater to drain

away from the store.

Security: There should be proper fencing or perimeter walls to improve

security and control access besides double locking door of the rooms
where costly medicines and supplies are kept.
Ordering supplies

Demand
planning

Reordering

Placing an order
 Demand planning
Consumption Method
uses records of past consumption of individual drugs to project future needs.
It is the most precise method for forecasting drug usage, provided the
changes in demand and use.
Morbidity Method
• This estimates the need for specific drugs based on the expected number
of attendances, the incidence of common diseases and their standard
treatment patterns.
• The basic formula used is:
• Quantity of the drug specified for a standard cours e of treatment x
Number of treatment episodes of the health problem = total quantity of a
drug required for a given health problem
Adjusted Consumption Method
• This method uses data on disease incidence, drug consumption or
utilization, and/or drug expenditures from a “standard” supply system and
extrapolates the consumption or utilization rates to the target supply.
 Reordering
• Reorder point: This is that level of drugs
available at which a new order for supply of
drugs is to be placed.
• Time to reorder: if the balance is less than the
reorder level, reordering should be done.
 Placing An Order

Use a requisition or order form to make a written request

Order information should be completed accurately

Make and keep a copy of the requisition or order form, or record

the name of item, its strength and form, and unit size

Send or deliver your requisition or order form to your suppliers

Write down the date your order was sent to your suppliers.
 Receiving supplies
• When you receive health commodities-

– Ensure there is sufficient storage space.

– Prepare and clean the areas used for receiving and
storing the products.
– Inspect packages for damaged or expired products
 Organizing Drug supplies
 Drugs to be stored in original containers
 Similar drugs (Oral/injectable, internal/external use) to be kept on same shelf
 Supplies to be arranged in alphabetical order/groups
 Items with short shelf life to be kept in front
 Ensure expiry dates are visible clearly
 Shelf storing principle to be followed-
 Top Shelves: dry medicines
 Middle shelves: liquid/injectables/ointments
 Bottom shelves: surgical items, laboratory supplies, condoms
 Within each drug group, arrange supplies in a alphabetical orders
 Store items in groups (easy to count)
 Store medicines and supplies with expiry dates by labeling “first expiry first out”
 Clear all expired/damaged supplies
 Identify overstocked items
 Keeping record of drugs and supplies

Bincard :It is a record of movement of materials against each kind of stock in respect of daily
transaction attached to each bin
Store ledger used to maintain up to date record of materials

Information's disclosed
On BIN CARD On STORE LEDGER
Quantity of materials received with date Account number of the item
Quantity of materials issued with date Decription of item
Balance stock in hand Maximum ,minimum and re-rder level
Minimum stock level Quantity received with date
Maximum stock level Cost of materials received
Re-ordering level Cost of issued materials
Job number in which the material is
used