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# TRANSPORTATION

PROBLEMS
TRANSPORTATION PROBLEM

## A transportation problem basically deals with

the problem, which aims to find the best
way to fulfill the demand of n demand
points using the capacities of m supply
points. While trying to find the best way,
generally a variable cost of shipping the
product from one supply point to a demand
point or a similar constraint should be
taken into consideration.
General Description of a
Transportation Problem
EXAMPLE
A company has three production facilities S1,S2,
S3 with production capacity of 7, 9 and 18 units
(in 100s) per week of a product respectively.
These units are to be shipped to four warehouses
D1, D2, D3, D4 with requirement of 5, 6,7 and 14
units (in 100s) per week, respectively. The
transportation costs (in Rupees) per unit between
factories to warehouses are given in the table on
next slide.
TRANSPORTATION COST MATRIX
D1 D2 D3 D4 Supply Row
Penalty
S1 19 30 50 10 7 9

S2 70 30 40 60 9 10

S3 40 8 70 20 18 12

Demand 5 8 7 14 34

Column 21 22 10 10
Penalty
OPTIMIZATION OF TRANSPORTATION
PROBLEM
Phase 1
Calculating Basic
Solution
(Using VAM)
Step 1: From the Table we determine the penalty
(element – smallest in its row (column) ) for each
row and column.
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 7 9

S2 70 30 40 60 9 10

S3 40 8 70 20 18 12

Demand 5 8 7 14 34

Column 21 22 10 10
Penalty
Step 2:
Identify the row or column with the
largest penalty among all the rows
and columns. If the penalties
corresponding to two or more rows or
columns are equal we select the
topmost row and the extreme left
column.
Step 3: Select Xij as a basic variable if Cij is the minimum cost
in the row or column with largest penalty. Choose Xij as high as
possible. Eliminate ith row or jth column depending upon
whether ai or bj is the smaller of the two.

D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 7 9

S2 70 30 40 60 9 10

S3 40 8 70 20 10 12

Demand 5 8 7 14 34

Column 21 22 10 10
Penalty
Step 4: The step (ii) is now performed on the reduced matrix
until all the basic variables have been identified.

D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 7 9

S2 70 30 40 60 9 20

S3 40 8 70 20 10 20

Demand 5 8 7 14 34

Column 21 22 10 10
Penalty
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 2 9

S2 70 30 40 60 9 20

S3 40 8 70 20 10 20

Demand 5 8 7 14 34

Column 21 22 10 10
Penalty
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 2 40

S2 70 30 40 60 9 20

S3 40 8 70 20 10 50

Demand 5 8 7 14 34

Column 21 22 10 10
Penalty
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 2 40

S2 70 30 40 60 9 20

S3 40 8 70 20 0 50

Demand 5 8 7 4 34

Column 21 22 10 10
Penalty
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 2 40

S2 70 30 40 60 9 20

S3 40 8 70 20 0 50

Demand 5 8 7 4 34

Column 21 22 10 50
Penalty
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 0 40

S2 70 30 40 60 9 20

S3 40 8 70 20 0 50

Demand 5 8 7 2 34

Column 21 22 10 50
Penalty
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 0 40

S2 70 30 40 60 7 20

S3 40 8 70 20 0 50

Demand 5 8 7 0 34

Column 21 22 40 50
Penalty
D1 D2 D3 D4 Supply Row
Penalty

S1 19 30 50 10 0 40

S2 70 30 40 60 0 20

S3 40 8 70 20 0 50

Demand 5 8 7 0 34

Column 21 22 40 50
Penalty
Phase 2
Calculating Optimal
Solution
MODIFIED DISTRIBUTION (MODI or u-v) METHOD
Step 1
Introduce dual variables corresponding to the row and
column constraints.
Eg. u1+v1=c11 = 19
D1 D2 D3 D4 Supply Row Constraints

S1 19 30 50 10 7 U1

S2 70 30 40 60 9 U2

S3 40 8 70 20 18 U3

Demand 5 8 7 14 34 U4

Column v1 v2 v3 v4
Constraints
Equations
Step 2: Any basic feasible solution of the
transportation problem has m + n – 1; Xjj >0.
Thus there will be m + n - 1 equations to
determine m + n dual variables. One of the dual
variables can be chosen arbitrarily. It is to be also
noted that as the primal constraints are
equations, the dual variables are unrestricted in
sign.

## Putting v4=0 (as it appears maximum number of times)

u3=20 v1=9
u2=60 v3=-20
u1=10 v2=-12
ij
are compared with the Cij values of this allocation
as: Cij – Ui - Vj .

## If all Cij – Ui - Vj ≥ 0, then by an application of

complementary slackness theorem it can be
shown that the corresponding solution of the
transportation problem is optimum. If one or more
of Cij – Ui - Vj < 0, we choose the cell with least
value of Cij – Ui - Vj and allocate as much as
possible subject to the row and the column
constraints. The allocation of a number of adjacent
cell are adjusted so that a basic variable becomes
non basic.
Basic Allocation
D1 D2 D3 D4 Supply Row Constraints

S1 5 2 7

S2 7 2 9

S3 8 10 18

Demand 5 8 7 14 34

Column
Constraints
Negative Value indicates that there is a possibility of
cost reduction by assigning to this cell.

## D1 D2 D3 D4 Supply Row Constraints

S1 +32 +60 7 10

S2 +1 -18 9 60

S3 +11 +70 18 20

Demand 5 8 7 14 34

## Column 9 -12 -20 0

Constraints
Re-Allocation
D1 D2 D3 D4 Supply Row Constraints

S1 5 2 7

S2 7 2 9
(+) (-)

S3 8(-) 10 18
(+)

Demand 5 8 7 14 34

Column
Constraints
RE-ALLOCATION

## D1 D2 D3 D4 Supply Row Constraints

S1 5 2 7 u1

S2 2 7 9 u2

S3 6 12 18 u3

Demand 5 8 7 14 34

Column v1 v2 v3 v4
Constraints
Step 4
A fresh set of dual variables
are computed and entire
procedure is repeated.
D1 D2 D3 D4 Supply Row Constraints

S1 19 30 50 10 7 U1

S2 70 30 40 60 9 U2

S3 40 8 70 20 18 U3

Demand 5 8 7 14 34 U4

Column v1 v2 v3 v4
Constraints

U1+v1=19 u1+v4=10
u2+v2=30 u2+v3=40
u3+v2=8 u3+v4=20
Putting u1=0 : v1=19,v2=-2,v3=8, v4=10, u2=32, u3=10
All positive values indicate that no further reduction
in cost is possible. Hence it is optimal solution.

## D1 D2 D3 D4 Supply Row Constraints

S1 +32 +42 7 0

S2 +19 +14 9 32

S3 +11 +52 18 10

Demand 5 8 7 14 34

Column 19 -2 8 10
Constraints
Optimal Solution

## D1 D2 D3 D4 Supply Row Constraints

S1 19 30 50 10 7 U1

S2 70 30 40 60 9 U2

S3 40 8 70 20 18 U3

Demand 5 8 7 14 34 U4

Column v1 v2 v3 v4
Constraints
Unbalanced Problem
THANKS!