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1
Transportation Problem
The distribution of goods produced from a factory and various warehouses to different
markets (destination) where they required, causes problems such as ,
Such problems can also be solved as linear programming problems to answer questions
like
a) What is the optimal way of shipping goods from various sources (warehouses) to different
markets to minimise the total shipping cost
e). How can production be scheduled, given the cost of production of an item and the cost of
carrying stock, so as to meet the requirements in different periods?
f). How to handle a situation if some routes are not available or when some units have to be
necessarily transported from a particular source to a particular market ?
3
Solution to the Transportation Problem
A firm owns facilities at seven places. It has manufacturing plants at A, B, and C with
daily out put of 500, 300 and 200 units of an item respectively. It has warehouses at
P,Q,R and S with daily requirement of 180, 150, 350 and 320 units respectively. The
transportation charges per unit on different routes are given below
To P Q R S
From A 12 10 12 13
From B 7 11 8 14
From C 6 16 11 7
The firm wants to send the output from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve its objective? 4
Solution to the Transportation Problem
From P Q R S Supply
To
From A 12 10 12 13 500
From B 7 11 8 14 300
From C 6 16 11 7 200
Demand 180 150 350 320 1000
Min. Z = 12X11 + 10X12 + 12X13 + 13X14 + 7X21 + 11X22 + 8X23 + 14X24 + 6X31 + 16X32 + 11X33 + 7X34
To P Q R S
From
A 12 10 12 13
B 7 11 8 14
C 6 16 11 7
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Transportation problem - Example 1 solve the problem using NWC method
A firm owns facilities at seven places. It has manufacturing plants at places A,B, C with
out-puts of 500, 300, and 200 units of an item respectively. It has warehouses at places P,
Q, R and S with daily requirements of 180, 150, 350 and 320 units respectively. Per unit
shipping charges on different routes are as follows
To P Q R S
From
A 12 10 12 13
B 7 11 8 14
C 6 16 11 7
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Initial Feasible Solution NWC method
Origin ( i ) Destinations ( j ) Supply ai
From To (j)
P Q R S
Demand bi
10
Initial Feasible Solution NWC method
Origin ( i ) Destinations ( j ) Supply ai
From To
P Q R S
12 10 12 13 170
Total Cost = (12 x180) + (10 x150) + (12 x 170) + (8 x 180) + (14 x 120) + ( 7 x 200) = Rs.10,220
Transportation problem - Example 1a. solve the problem using NWC method
Find the initial feasible solution to the following transportation problem
To P Q R S Supply
From
A 11 13 17 14 250
B 16 18 14 10 300
C 21 24 13 10 400
Demand 200 225 275 250 950
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Example 1a -Initial Feasible Solution NWC method
Origin ( i ) Destinations ( j ) Supply ai
From To
P Q R S
A 200 50 250
50
11 13 17 14
Total Cost = (11x200)+(13 x50)+(18 x 175)+(14 x 125)+(13 x 150)+(10x 250) = Rs. 12,200
Transportation problem - Example 2 solve the problem using LCM
A firm owns facilities at seven places. It has manufacturing plants at places A,B, C with
out-puts of 500, 300, and 200 units of an item respectively. It has warehouses at places P,
Q, R and S with daily requirements of 180, 150, 350 and 320 units respectively. Per unit
shipping charges on different routes are as follows
To P Q R S
From
A 12 10 12 13
B 7 11 8 14
C 6 16 11 7
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Initial Feasible Solution Least Cost Method (LCM)
Origin ( i ) Destinations ( j ) Supply ai
From To
P Q R S
12 10 12 13 350
B 300 300
7 11 8 14
C 180 20 200
6 16 11 7 20
Demand bi 180 150 350 320 1,000
15
Total Cost = (6 x180) + (10 x150) + (12 x 50+ 8x300) + (13 x 300) + (7 x 20) = Rs.9,620
Transportation problem - Example 2a - solve the problem using LC method
Find the initial feasible solution to the following transportation problem
To P Q R S Supply
From
A 11 13 17 14 250
B 16 18 14 10 300
C 21 24 13 10 400
Demand 200 225 275 250 950
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Example 1a -Initial Feasible Solution LCM
Origin ( i ) Destinations ( j ) Supply ai
From To
P Q R S
A 200 50 250
50
11 13 17 14
Total Cost = (11x200)+(13 x50)+(18 x 175)+(14 x 125)+(13 x 150)+(10x 250) = Rs. 12,200
Example 1a -Initial Feasible Solution LCM
Origin ( i ) Destinations ( j ) Supply ai
From To
P Q R S
A 200 50 250
50
11 13 17 14
B 50 250 300
16 18 14 10 50
Total Cost = (11x200)+(13 x50)+(18 x 50)+(24 x 125)+(13 x 275)+(10x 250) = Rs. 12,825
Example 3 -Initial Feasible Solution Vogles’s Approximation method (VAM)
A firm owns facilities at seven places. It has manufacturing plants at places A,B, C with
out-puts of 500, 300, and 200 units of an item respectively. It has warehouses at places P,
Q, R and S with daily requirements of 180, 150, 350 and 320 units respectively. Per unit
shipping charges on different routes are as follows
To P Q R S
From
A 12 10 12 13
B 7 11 8 14
C 6 16 11 7
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Example 3 - Initial Feasible Solution Vogles’s Approximation method (VAM)
Origin ( i ) Destinations ( j ) Supply ai Iterations (penalty coloumn)
From To
P Q R S I II III IV
A 12 10 12 13 500 2
B 7 11 8 14 300 1
C 6 16 11 7 200 200 1 -
Penalty row
I 1 1 3 *6
II
III
Example 3 - Initial Feasible Solution Vogles’s Approximation method (VAM)
Origin ( i ) Destinations ( j ) Supply ai Iterations (penalty coloumn)
From To
P Q R S I II III IV
A 12 10 12 13 500 2 2
B 7 180 11 8 14 300 1 1
120
C 6 16 11 7 200 200 1 -
Penalty row
I 1 1 3 *6
II *5 1 4 1
III
Example 3 - Initial Feasible Solution Vogles’s Approximation method (VAM)
Origin ( i ) Destinations ( j ) Supply ai Iterations (penalty coloumn)
From To
P Q R S I II III IV
A 12 10 12 13 500 2 2 2
Penalty row
I 1 1 3 *6
II *5 1 4 1
III 1 *4 1
Example 3 - Initial Feasible Solution Vogles’s Approximation method (VAM)
Origin ( i ) Destinations ( j ) Supply ai Iterations (penalty coloumn)
From To
P Q R S I II III IV
Penalty row
I 1 1 3 *6 Total cost = (180x7)+(150x10)+(230x12 +
II *5 1 4 1 120x8)+ (120x13+200x7) = 9,440
III 1 *4 1
Example 3a - Initial Feasible Solution Vogles’s Approximation method (VAM)
To P Q R S Supply
From
A 11 13 17 14 250
B 16 18 14 10 300
C 21 24 13 10 400
Demand 200 225 275 250 950
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Example 3a - Initial Feasible Solution Vogles’s Approximation method (VAM)
Origin ( i ) Destinations ( j ) Supply ai Iterations (penalty coloumn)
From To
P Q R S I II III IV
A 11 200 13 50 17 14 250 2 1 -
50
Penalty row
I *5 5 1 4
II - *5 1 4 (200x11)+(13x50)+18x175)+(13x275)+(125x10)+125x10)
III *6 1 0
= 12,075
IV 1 0
Testing the optimality in Transportation problem
C 6 16 11 7 200 200
Check Loop 2
Testing the optimality by Stepping Stone Method
Origin ( i ) Destinations ( j ) Supply ai
From To P Q R S
C 6 16 11 7 200 200
C 6 16 11 7 200 200
Loop 3 : BQ - BR – AR -AQ = 11 – 8 + 12 – 10 = 5
Testing the optimality by Stepping Stone Method
Origin ( i ) Destinations ( j ) Supply ai
From To P Q R S
200
C 6 16 11 (-) 7 200
200
C 6 (+) 16 11 (-) 7 200
200
C 6 16 (+)11 (-) 7 200
Loop 6 CR : CR – CS + BS - BR = 11 – 7 +14 -8 = 10
Testing the optimality by Stepping Stone Method
Origin ( i ) Destinations ( j ) Supply ai
From To P Q R S
C 6 16 11 7 200 200
Loop1 : AS-AR+BR-BS = (13 – 12 + 8 - 14) = - 5, Implies that, the solution is not optimal because Rs. 5 can be
reduced by adopting the route AS
Opportunity cost at : AS = – 5 Move qty. from lowest negative sign quantities to positive sign cells
: BP = - 1
: BQ = 5 Total Cost = (12 x180) + (10 x150) + (12 x 170) +
: CP = 5 (8 x 180) + (14 x 120) + ( 7 x 200) = Rs.10,220
: CQ = 17 and
: CR = 10
Testing the optimality by Stepping Stone Method
Origin ( i ) Destinations ( j ) Supply ai
From To P Q R S
C 6 16 11 7 200 200
Loop1 : AS-AR+BR-BS = (13 – 12 + 8 - 14) = - 5, Implies that, the solution is not optimal because Rs. 5 can be
reduced by adopting the route AS
Opportunity cost at : AS = – 5 Move qty. from lowest negative sign quantities to positive sign cells
: BP = - 1
: BQ = 5 Total Cost = (12 x180) + (10 x150) + (12 x 50) +
: CP = 5 (8 x 300) + (13x 120) + ( 7 x 200) = Rs. 9,620
: CQ = 17 and
: CR = 10
Testing the optimality by Stepping Stone Method
Origin ( i ) Destinations ( j ) Supply ai
From To P Q R S
C 6 16 11 7 200 200
C 6 16 11 7 200 200
C 6 16 11 7 200 200
C 6 16 11 7 200 200
Optimal solution
Unbalanced Transportation Problem
there
Prohibited Routes Transportation Problem
Some times some routes may not be available due to a variety of reasons like the
unfavourable weather conditions, strikes etc.
To handle a situation of this type, we assign assign a very large cost represented by M
to each of such routes which are not available.
The effect of adding a large cost element would be that such routes would
automatically be eliminated in the final solution.
Example 5a - An FMCG company has four warehouses to distribute its products in four
markets at the transport cost as given in the following table.
1 M 12 7 180
2 14 11 6 100
3 9 5 M 160
4 11 7 9 120
5 0 0 0 100
Demand 240 200 220 660
bi
I Transportation problem
Unbalanced with prohibited routes
II
III
IV
Initial Feasible solution using VAM
V
Market ( j ) Supply ai Iterations (penalty)
A B C I II III IV V
1 M 12 7 180 5
2 14 11 6 100 5
3 9 5 M 160
4
4 11 7 9 120 2
5 0 100 0 0 100
0
Demand 240 200 220 660
bi 140
I *9 5 6 Transportation problem
II Unbalanced with prohibited routes
III
IV Initial Feasible solution using VAM
V
Market ( j ) Supply ai Iterations (penalty)
A B C I II III IV V
*5
1 M 12 7 180 5
2 14 11 6 100 100 5 *5
3 9 5 M 160 4
4
4 11 7 9 120 2 2
5 0 100 0 0 100
0
Demand 240 200 220 660
bi 140 120
I *9 5 6 Transportation problem
Unbalanced with prohibited routes
II 2 2 1
III
IV
Initial Feasible solution using VAM
V
Market ( j ) Supply ai Iterations (penalty)
A B C I II III IV V
5 *5
1 M 12 7 180 5
2 14 11 6 100 100 5 *5
3 9 5 M 160 4 4
4
4 11 7 9 120 2 2 2
5 0 100 0 0 100
0
Demand 240 200 220 120 660
bi 140
I *9 5 6
II 2 2 2
III 2 2 2
IV
V
Market ( j ) Supply ai Iterations (penalty)
A B C I II III IV V
5 *5
1 M 12 7 120 180 60 5
2 14 11 6 100 100 5 *5
3 9 5 M 160 4 4
4
4 11 7 9 120 2 2 2
5 0 100 0 0 100
0
Demand 240 200 220 120 660
bi 140
I *9 5 6
II 2 2 2
III 2 2 2
IV
V
Market ( j ) Supply ai Iterations (penalty)
A B C I II III IV V
5 *5
1 M 12 7 120 180 60 5
2 14 11 6 100 100 *5
5
3 9 5 160 M 160 4 4 *4
4
4 11 7 9 120 2 2 2
2
5 0 100 0 0 100 0
Demand 240 200 40 220 120 660
bi 140
I *9 5 6
II 2 2 2
III 2 2 2
IV 2 2 2
V
Market ( j ) Supply ai Iterations (penalty)
A B C I II III IV V
5 *5
1 M 12 7 120 180 60 5
2 14 11 6 100 100 *5
5
3 9 5 160 M 160 4 4 *4
4
4 11 7 9 120 2 2 2 4
40 2
80
5 0 100 0 0 100 0
Demand 240 200 40 220 120 660
bi 140
I *9 5 6
II
III
2
2
2
2
2
2
?
IV 2 2 2
V *5 2
Market ( j ) Supply ai Iterations (penalty)
A B C I II III IV V
5 *5
1 M 12 7 180 180
2 14 11 6 100 5 5
3 9 5 M 160 4 4
4 11 7 9 120 2 2
5 0 100 0 0 100 0
2 14 11 6 40 100 5 5 *5
60
3 9 5 M 160 4 4 4
4 11 7 9 120 2 2 2
5 0 100 0 0 100 0
2 14 11 6 40 100 5 5 *5 3
60
3 9 5 160 M 160 4 4 4 *4
4 11 7 9 120 2 2 2 4
5 0 100 0 0 100 0
2 14 60 11 6 40 100 5 5 5 3 3
60
3 9 5 160 M 160 4 4 4 *4
4 11 80 7 40 9 120 2 2 2 2 4
80
5 0 100 0 0 100 0
III 2 2 3
IV 2 2 3
V 3 *4
Check for optimality by MODI – UV Method
Market ( j ) Supply ai
A B C
1 M 12 7 180 180
2 14 60 11 6 40 100
3 9 5 160 M 160
4 11 80 7 40 9 120
5 0 100 0 0 100
Demand 240 200 220 660
bi
ui +vj = cij C13 = (U1 + V3 =7), (0+ V3 ) = 7, V3 = 7 C42 = (U4 + V2 =7), (-4+ V2 ) = V2 = 11
C23 = U2+V3 = 6, U2+7 = 6, U2 = - 1
C21= U2+V1=14, -1+V1 = 14, V1 = 15 C32 = U3+V2 = 5, U3+11 = 5, U3 = - 6
C41 = U4+V1 = 11, ( U4+15 = 11), U4 = - 4 C51= U5+V1= 0, (U5+15) = -15
Check for optimality by MODI – UV Method
Pij = Ui + Vj – Cij
P12 = 0+11 -12 = -1
P22 = -1 +11-11 = -1
Check for optimality by MODI – UV Method
Market ( j ) Supply ai ui
A B C
1 M 12 (-1) 7 180 180 u1 = 0
2 14 60 11 (-1) 6 40 100 u2 = -1
3 9 (0) 5 160 M 160 u3 = - 6
4 11 80 7 40 9 (-6) 120 u4 = - 4
5 0 100 0 (-4) 0 (-8) 100 u5 = - 15
Demand 240 200 220 660
bi
vj v1 = 15 v2 =11 v3 = 7
P53= -15 +7 -0 = -8
Check for optimality by MODI – UV Method
Market ( j ) Supply ai ui
A B C
1 M 12 (-1) 7 180 180 u1 = 0
2 14 60 11 (-1) 6 40 100 u2 = -1
3 9 (0) 5 160 M 160 u3 = - 6
4 11 80 7 40 9 (-6) 120 u4 = - 4
5 0 100 0 (-4) 0 (-8) 100 u5 = - 15
Demand 240 200 220 660
bi
vj v1 = 15 v2 =11 v3 = 7
Check for optimality by MODI – UV Method
Market ( j ) Supply ai ui
A B C
1 M 12 (-1) 7 180 180 u1 = 0
2 14 60 11 (-1) 6 40 100 u2 = -1
3 + 9 (0) - 5 160 M 160 u3 = - 6
4 - 11 80 + 7 40 9 (-6) 120 u4 = - 4
5 0 100 0 (-4) 0 (-8) 100 u5 = - 15
Demand 240 200 220 660
bi
vj v1 = 15 v2 =11 v3 = 7
Check for optimality by MODI – UV Method
Market ( j ) Supply ai ui
A B C
1 M 12 7 180 180 u1 = 0
2 14 60 11 6 40 100 u2 = -1
3 9 80 5 80 M 160 u3 = - 6
4 11 7 120 9 120 u4 = - 4
5 0 100 0 0 100 u5 = - 15
Demand 240 200 220 660
bi
vj v1 = 15 v2 =11 v3 = 7
Total Cost = (14 x60) + (9 x80) + (0x 100) + (5 x 80) + (7 x120) + ( 7 x 180) +(6X40) = Rs. 4,300
Total Cost = 840 + 720 + 0 + 400 + 840 + 1,260 + 240 = Rs. 4,300
Total cost by VAM = (7x180+14x60)+(6x40)+(5x160)+ (11x80)+(7x40) +(0x100) = 4,300
Assignment Q.No – 10 Find the initial feasible solution by VAM method and Test
the optimality by MODI method to minimise the transport cost
To P Q R S Supply
From
A 11 13 17 14 250
B 16 18 14 10 300
C 21 24 13 10 400
Demand 200 225 275 250 950
The firm wants to send the out-put from various plants to warehouses involving minimum
transportation cost. How should it route the product so as to achieve this objective
Example 3a - Initial Feasible Solution Vogles’s Approximation method (VAM)
Origin ( i ) Destinations ( j ) Supply ai
From To
P Q R S
A 11 200 13 50 17 14 250
m + n -1 = 7 (allocated cells)
(200x11)+(13x50)+18x175)+(13x275)+(125x10)+125x10) = 12,075