Cellular manufacturing is an important application of group technology and the cell formation process is one of the important steps in designing cellular manufacturing system. In recent years, researchers have noticed potential benefits when the layout problem is considered within the cell formation process. Nevertheless, there are not sufficient studies about consideration of real-life features in the cell formation and layout design process. In this paper, a new approach is presented to integrate the cell formation and its layout design. The proposed approach has three important design features not found in other papers. These design features are multi-row intra-cell layout (layout of machines within the cells), continuous inter-cell layout (layout of rectangular shape cells on the planar area), and aisle distance. The objective of the proposed approach is to form machine cells, find the layout of machine cells, and obtain the arrangement of machines within the cells such that the total material handling cost is minimized. In order to have a more accurate layout design, the material handling cost is calculated in terms of the actual position of machines within the cell. Due to the computational complexity of the proposed problem, a heuristic method is proposed to solve medium- and large-scale problems in a reasonable computational time. Three lower bounds are developed for the proposed integrated problem in which the tightest of them is chosen for evaluating the solution of the heuristic method. Finally, numerical examples adopted from the literature are solved to verify the performance of the proposed heuristic method and illustrate the advantages of the proposed integrated approach. The results indicated that the heuristic method is both effective and efficient in solving real-sized problems. The results also demonstrated that the proposed layout approach gives better layout design in comparison with the existing approaches.
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