3. Meaning
The transportation problem is a special type of linear programming
problem where the objective is to minimise the cost of distributing a
product from a number of sources or origins to a number of destinations.
4. Application of Transportation Model
• Minimize shipping costs
• Determine low cost location
• Find minimum cost production schedule
• Military distribution system
5. Two Types of Transportation Problem
• Balanced Transportation Problem where the total supply equals total
demand
• Unbalanced Transportation Problem where the total supply is not equal to
the total demand
6. Methods of Transportation Problem
North West Corner Rule (NWCR):- The northwest-corner rule requires that
we start in the upper left-hand cell (or northwest corner) of the table and
allocate units to shipping routes.
7. Conti…
Row Minima Method:- consists in allocation as much as possible in the lowest cost
cell of the first row so that either the capacity of the first plant is exhausted or the
requirement at distribution centre is satisfied or both.
8. Conti…
Column Minima Method: This method consists of allocating as much as
possible lowest cost cell of the first column.
9. Conti…
Least Cost Method: This method consists of allocating as much as
possible lowest cost cell of the table.