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Facility layout design is becoming more challenging as manufacturing moves from traditionally emphasised mass production to mass customisation. The increasing demand for customised products and services is driving the need to increase flexibility and adaptability of both production processes and their material handling systems. A holistic approach for designing facility layouts with optimised flows considering production and logistics systems constraints seems to be missing in the literature. Several tools, including traditional methods, analytic hierarchy process, multiple-attribute decision making, simulation, and optimisation methods, can support such a process. Among these, simulation-based optimisation is the most promising. This paper aims to develop a facility layout design methodology supported by simulation-based optimisation while considering both production and logistics constraints. A literature review of facility layout design with simulation and optimisation and the theoretical and empirical challenges are presented. The integration of simulation-based optimisation in the proposed methodology serves to overcome the identified challenges, providing managers and stakeholders with a decision support system that handles the complex task of facility layout design.