KM ALUMUNIUM is one of the manufacturing company that produce household appliance such as frying pan and bread mold using aluminium as its basic material. KM ALUMUNIUM always producing every day following the customer order. According to the observation and interview result towards the owner and the workers, obtained that the facility layout on the shop floor is not good enough, it causes difficulty to the workers when doing material handling activities that makes productivity to becomes low. To redesign the facility layout, ARC (Activity Relationship Chart) and ARD (Activity Relationship Diagram) methods are used and it was implemented on computer simulation model using Flexsim 6.0 to see how much the improvement could be applied. It is obtained that the cause of bad facility layout is the finished warehouse location and finishing process location is not corresponding to the production flow so that it makes the frequency of workers delivering goods to be higher. By swapping the finished warehouse to the finishing process location and simulated for 1 workday, it is obtained that the material handling cost is reduced as many as 55,22% and the production output is increased by 25 products.