In this paper ongoing production process layout of jute industry are studied and a new layout will be developed based on the systematic layout planning pattern theory to reduce production cost and increase productivity. The number of equipment and travelling area of material in yarn production have been analyzed. The detailed study of the plant layout such as operation process chart, activity relationship chart and relationship between equipment and area has been investigated. The new plant layout has been designed and compared with existing plant layout. The new plant layout shows that the distance and overall cost of material flow from stores to dispatch area are significantly decreased.