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# LEAST COST METHOD

## FIND SOLUTION OF TRANSPORTATION PROBLEM USING LEAST COST

METHOD
TOTAL NO. OF SUPPLY CONSTRAINTS : 3
TOTAL NO. OF DEMAND CONSTRAINTS : 4
PROBLEM TABLE IS
D1 D2
D3
D4

Supp
ly

S1

11

13

17

14

250

S2

16

18

14

10

300

S3

21

24

13

10

400

Deman
d

20
0

225

275

250

## FINAL ALLOCATION TABLE IS:-

D1

D2

D3

D4

Suppl
y

S1

11(200)

13(50)

17

14

250

S2

16

18(17
5)

14(125
)

10

300

S3

21

24

13(150
)

10(250
)

150

Deman
200 of allocation
225
275
Here,
the number
is
equal to250
m+n-1=3+4
-1d
= 6
The solution is feasible.
Total Transportation cost = 11 200 + 13 50 + 18 175
+ 14 125 + 13 150 + 10 250 = 12200
The minimized total transportation cost = 12200

## Vogel Approx method

Find Solution of Transportation Problem Using Voggel's
Approximation Method
TOTAL no. of supply constraints : 3
TOTAL no. of demand constraints : 4
Problem Table is
D1

D2

D3

D4

Supp
ly

S1

11

13

17

14

250

S2

16

18

14

10

300

S3

21

24

13

10

400

Deman
d

20
0

225

275

250

D1

D2

D3

D4

Suppy

Penalty

S1

11(200
)

13(50)

17

14

250

2|1|--|--|--|--|

S2

16

18(175 14
)

10(125 300
)

4|4|4|4|--|--|

S3

21

24

13(275)

10(125 400
)

3|3|3|3|3|10|

Demand

200

225

275

250

Col
Penalty

5
5
1
_
5
1
_
6
1
_
_
1
_
_
13
_
_
_
Here, the number of allocation is equal
The solution is feasible.
Total Transportation cost = 11 200 +
275 + 10 125 = 12075

0
0
0
0
10
10
to m + n - 1 = 3 + 4 - 1 = 6
13 50 + 18 175 + 10 125 + 13

## The minimized total transportation cost = 12075

MODI Method
Now modi method starts....
Find Ui and Vj, Cij = Ui + Vj, for all occupied cells(i,j)
Substituting, U1= 0, we get
C11= U1+ V1 11 = 0 + V1 V1= 11 - 0 = 11
C12= U1+ V2 13 = 0 + V2 V2= 13 - 0 = 13
C22= U2+ V2 18 = U2+ 13 U2= 18 - 13 = 5
C24= U2+ V4 10 = 5 + V4 V4= 10 - 5 = 5
C34= U3+ V4 10 = U3+ 5 U3= 10 - 5 = 5
C33= U3+ V3 13 = 5 + V3 V3= 13 - 5 = 8
D1

D2

D3

D4

Suppy

Ui

S1

11(200
)

13(50)

17

14

250

S2

16

18(175 14
)

10(125 300
)

S3

21

24

13(275)

10(125 400
)

Demand

200

225

275

250

Vj

11

13

D13= C13- (U1+
D14= C14- (U1+
D21= C21- (U2+
D23= C23- (U2+
D31= C31- (U3+
D32= C32- (U3+

## + Vj), for all unoccupied cells(i,j)

V3) = 17 - (0 + 8) = 9
V4) = 14 - (0 + 5) = 9
V1) = 16 - (5 + 11) = 0
V3) = 14 - (5 + 8) = 1
V1) = 21 - (5 + 11) = 5
V2) = 24 - (5 + 13) = 6

D1

D2

D3

D4

Suppy

Ui

S1

11(200
)

13(50)

17[9]

14[9]

250

S2

16[0]

18(175 14[1]
)

10(125 300
)

S3

21[5]

24[6]

13(275)

10(125 400
)

Demand

200

225

275

250

Vj

11

13

D1

D2

D3

D4

Supply

S1

11(200)

13(50)

17

14

250

S2

16

18(175)

14

10(125)

300

S3

21

24

13(275)

10(125)

400

Demand

200

225

275

250

## Here, the number of allocation is equal to m + n - 1 = 3 + 4 - 1 = 6

The solution is feasible.
Total Transportation cost = 11 200 + 13 50 + 18 175 + 10 125
+ 13 275 + 10 125 = 12075
The minimized total transportation cost = 12075

S1 refers to alto
S2 refers to swift
S3 refers to ritz
D1 refers to shivaji nagar
D2 refers to viman nagar
D3 refer to Aundh
Conclusion : - It shows if they increase there supply to viman nagar .
And if they meet the demand of viman nagar that will help to
decrease their cost and increase their turn over

0R ASSIGNMENT

TRANSPORATION PROBLEM TO
MINIMIZE THE TRANSPORTATION COST
OF MARUTI SUZUKI PVT LTD COMPANY
SUBMITTED BY
1) AYUSH BASANDANI PRN

_1403122017
2) DEPEESH

PRN

_14030122053
3) KAUSHIKY SHARMA PRN

_14030122005

## BBA (IT) Students, Second year, SEM III

A mini Project submitted in Partial fulfillment of the
requirement of Operations
Research Internal Exam for the Degree of BBA
(IT)/BCA
At Symbiosis Institute of Computer Studies &
Research
Symbiosis International (Deemed) University
Model colony, Atur Centre,
PUNE -411007
Batch - BBA (IT) 2014-17

ACKNOWLEDGEMENT
To Director SICSR Dr. Lalit Kathpalia, Deputy
Director Harshad Guney, OS, Course in charge
Prof .Rajeshree, Guide Prof. Shilpa Mujumdar.
We would also like to thank Cadbury Pvt Ltd and
specially the managing director for his help in
our work. Last but not least, our greatest
appreciation and love goes to our families and
for sure this would not have happened without
their unconditional support, love and care.

Source of data
Data is collected by survey from internet, the following are the webpages
that data was collected:
P.K Gupta, and D.S Hira, Operation Research, S. Chand Company Ltd.,
2004
http://www.diva-portal.org/smash/get/diva2:518851/fulltext01
The data is collected for period 2013-2014.

## Methodology for data analysis:

Transportation problem is a member of a category of linear programming
(LP) called Network flow problem which deals with the distribution of
goods from several points of Supply (sources) to a number of points of
demand (destination). It involves finding an Initial solution.

Methods

## VAM (Vogels Approximation Method)

This method also takes costs into account in allocation. Five steps are involved in applying this heuristic:
Step 1:Determine the difference between the lowest two cells in all rows and columns, including dummies.
Step 2:Identify the row or column with the largest difference. Ties may be broken arbitrarily.
Step 3:Allocate as much as possible to the lowest-cost cell in the row or column with the highest
difference. If two or more differences are equal, allocate as much as possible to the lowest-cost cell in these
rows or columns.
Step 4:Stop the process if all row and column requirements are met. If not, go to the next step.
Step 5:Recalculate the differences between the two lowest cells remaining in all rows and columns. Any
row and column with zero supply or demand should not be used in calculating further differences. Then go
to Step 2.
The Vogel's approximation method (VAM) usually produces an optimal or near- optimal starting solution.
One study found that VAM yields an optimum solution in 80 percent of the sample problems tested.

Least

Cost Method
Least cost method, we start giving allocations from the minimum
cost in the matrix. It means that cell for which cost is minimum is
given allocation first. Then allocation is given in next minimum cost
and so on. It means lower cost cells are given priority over higher

## Where as in NWCR, there is no priority to lower cost cells. We start

giving allocation from 1stNorth West corner, then next North West
corner and so on. Hence, generally, the Initial solution obtained
by LCM is lower than that by NWCR.
Hence, LCM solution isnearer to the optimalsolution as compared
to NWCR solution. Hence, LCM is a better method than NWCR.