Abstract Implementing lean manufacturing practices in the systematic layout planning (SLP) process for improving facility layouts in various industries is essential. This approach enhances material handling processes and effectively manages space utilization. An efficient plant employing systematic layout planning leads to improved resource utilization and facilitates the integration of lean manufacturing techniques such as value stream mapping, 5 S, Ohno’s 7 wastes, and cellular manufacturing. This research article presents a case study on a steel processing plant in Dubai with an area of 160 m × 160 m, where systematic layout planning and lean manufacturing techniques were applied. The factors considered included space and material flow optimization, incorporating layout alternatives based on systematic layout planning principles along with lean manufacturing techniques. The study revealed a 34% reduction in material flow and an efficient overall space utilization improvement of 26%. Additionally, cost analysis validation was conducted.