Transportation

Problems
Introduction
 The Transportation Problem is one of the sub-classes of linear programming problems in
which the objective is to transport various quantities of a single homogeneous commodity,
that are initially at various origins to different destinations in such a way that the total
transportation cost is minimum.

 To achieve this objective we must know the amount and location of available suppliers and
the quantities demanded in addition to the involvement of the cost associated with transporting
or sending the required quantities of items from sources to destinations.
Introduction (Contd.)
 The name Transportation Model however is not limited to just transportation of commodities
from different sources to various destinations and also finds application for Machine
Assignment, Plant Location, Product Mix Problems etc.
Definition of Transportation Model
 A manufacturer wishes to transport a number of units of a homogeneous product from several
warehouses (origins) to a number of retail stores (destinations). Each store requires or has a demand
of (bj) units of the product by the jth store.

 While each warehouse can supply or fulfill a maximum demand of (ai) i.e. capacity of ith warehouse.

 The cost of transportation of a unit from ith warehouse (origin) to jth retail store (destination) is Cij
and is known for all combinations of (ij).

 The problem is to determine the amount (i.e. no of units) xij to be transported over all routes (i, j) so
as to minimize the total cost of transportation.
 Definition of Transportation Model
DESTINATIONS  The problem discussed in the previous slide
i j 1 2 3 …… n ai can be expressed in the tabular form.
O 1 x11 x12 x13 x1n a1
 The amount shipped from origin i to
R 2 x21 x22 x23 x2n a2
I 3 x31 x32 x33 x3n a3 destination j is xij.
G
. ..  The total shipped from origin i is ai where ai
I .
N . ≥ 0, and received by destination j is bj ≥ 0.
S
. .  The total amount shipped is equal to the total
m xm1 xm2 xm3 xmn am
amount received i.e. ⅀ai = ⅀bj (i.e. Balanced
bj b1 b2 b3 ……. bn
. Transportation Problem)
Definition of Transportation Model
 The total cost of shipping xij units is Cij * xij.

 Since, negative shipments has no meaning, hence we restrict each xij ≥ 0.

 The problem can be mathematically stated as follows: Find the values of (xij) s which will
minimizes the total cost of transportation.
 Mathematical Formulation for
Transportation Problem
Objective
  function (To minimize the cost of Transportation)

(availability constraints) ------------- eq (1)

(requirement or demand constraints)-------- eq(2)

and xij ≥ 0
In order that equations (1) and (2) are consistent, we should have:
m = No of origin points to supply and n = No of destination points
Methods for finding the Initial Basic Feasible
Solution for Transportation Problems
1. North West Corner Method
Problem 1: Obtain the initial basic feasible solution for the given transportation problem.
Markets Available
Plants D E F G
A 11 13 17 14 250
B 16 18 14 10
300
C 21 24 13 10
Requirements 200 215 275 250 400
Problem 2:

A dairy farm has three plants located throughout the state of Uttar Pradesh. Daily milk production at each of the plant is
follows:
Plant 1: 3 Million litres
Plant 2: 12 Million litres
Plant 3: 8 Million litres
Each plant must fulfill the needs of four distribution centres. Minimum requirement of each distribution centre is as
follows:
DC1: 7 Million litres
DC2: 5 Million litres
DC3: 9 Million litres
DC4: 2 Million litres
Cost of shipping one million l itre of the milk from each plant to each distribution centre is given in table in hundreds of
rupees.
 Distribution centres

DC1 DC2 DC3 DC4

2 3 11 7
1
Plants 2 12 10 6 1
3 5 8 15 9
 Methods for finding the Initial Basic Feasible
Solution for Transportation Problems
2. Least cost or matrix minimize methods
Problem 3 Solve the transportation problem using least cost method.
D1 D2 D3 D4 Supply
1 2 3 4 6
O1
O2 4 3 2 0
O3 8
0 2 2 1
10
Demand 4 6 8 6
Methods for finding the Initial Basic Feasible
Solution for Transportation Problems
3. Vogel’s Approximation Method (VAM or Penalty Method)
Problem 3. Use VAM method find out the initial basic feasible solution of the given
transportation problem.

Markets

Plants D E F G Available
A 11 13 17 14 250
B 16 18 14 10
300
C 21 24 13 10
400
Requirements 200 225 275 250
Problem 4: Use VAM to solve the transportation problem.

Markets
Plants D1 D2 D3 D4 Available

O1 21 16 25 13 11
O2 17 18 14 23
13
O3 32 27 18 41
19
Requirements 6 10 12 15
Degeneracy in Transportation Problems
 Once the initial solution is determined by using North West Corner Method or Least Cost
Method or VAM Method, the next step is to check whether or not the solution is degenerate.

 Degeneracy is the condition where the number of positive variables in the basic solution is less
than (m+n-1)

where m-- number of rows and n- number of columns

For an (mxn) transportation table, the number of basic cells must be (m+n-1). Once degeneracy
occurs, we cannot find the optimal solution by Stepping stone method or MODI method.
 Test for optimality
1. Stepping Stone Method
Question 1 : An initial solution is obtained North West Corner Method to a transportation
problem as shown. Find out the optimal allocation if possible by further improvement in
allocation.
C D E CAPACITY
A
5 10 2 100
B 3 7 5
25
6 8 4
C
75
REQUIREMENT 80 30 90

(5 80 ; 10 20) (710; 5 15) (475)

 Question 2: Test the optimality by stepping stone method

D E F
Capacity
A 10
2 1 5
7 3 4 25
B
6 5 3
C 20

Requirement 15 22 18
2. Modified Distribution or MODI
Method (u-v method)
Problem 1: Solve the following transportation problem using MODI method.

W1 W2 W3 W4

11 200 13 50 17 14
F1
16 18 175 14 125 10
F2
21 24 13 150 10 250
F3
 Problem 2: Use MODI method to check the optimality of the following transportation problem

W1 W2 W3 W4

F1 19 5 30 50 10 2
F2 70 30 40 7 60 2
F3 40 8 8 70 20 10
 A company has four warehouses and six stores. The warehouses together have a surplus of 22 units of a given
commodity divided among them as shown below. The six stores together need 22 units of commodity. Individual
requirements of stores are given below. Cost of shipping is give in the tabular form.
How should the products be shipped from the warehouses to the stores so that transportation cost is minimum.
Solve by VAM and then MODI method. Also explain the degeneracy. (degeneracy in initial stages)

S1 S2 S3 S4 S5 S6 Availability
9 12 9 6 9 10
W1 5
W2 7 3 7 7 5 5
6
W3 6 5 9 11 3 11 2
W4 6 8 11 2 2 10 9

Requirements 4 4 6 2 4 2
 VAM Solution (Initial Basic Feasible Solution)

S1 S2 S3 S4 S5 S6 Availability
9 12 9 6 9 10
W1 5 5
W2 7 3 4 7 7 5 5 2 6
W3 6 1 5 9 1 11 3 11 2
W4 6 3 8 11 2 2 2 4 10 9

Requirements 4 4 6 2 4 2
 Find the basic feasible solution using North –West Corner Method and then investigate the optimal
solution using MODI method

1 2 3 4 5
4 3 1 2 6 80
A
B 5 2 3 4 5
60
C 3 5 6 3 2
40
D 2 4 4 5 3
20

60 60 30 40 10