Application of

Transportation Model in
Business/Industries
PRESENTED BY:-GROUP 3

ARKA PRBHA GHOSH(09DF011)

ARNAB DAS(09DF012)
ARUN KUMAR(09DF013)
ARUNJYOTI MUKHERJEE(09DF014)
ASHRAF ANSARI(09DF015)
 INTRODUCTION
Transportation problem is to
transport various amount of a
single homogeneous commodity,
that are initially stored at various
origins, to different destinations
in such way that the total
transportation cost is minimum.
 METHODS OF
TRANSPORTATION
North-West Corner Rule(NWCR)

Lowest Cost Entry Method(LCEM)

Vogels Approximation Method(VAM)

North West Corner Method
Wareho
Facto use Capacity
ry W1 W2 W3 W4 (Supply)
21 16 25 13

F1 6 5 11

17 18 14 23

F2 5 8 13

32 27 18 41

F3 4 15 19

Requirement
(Demand)
6 10 12 15 43
 Initial Basic Feasible
Solution
X11=6
X12=5
X22=5
x23=8
X33=4
X34=15

Total Transportation
Cost=(6*21)+(5*16)+(5*18)+(8*14)+(4*18)+(15*41)
=Rs1055
 Applications of NWCM
The main areas of applications of
NWCM are:
It is used for transportation within
the campus of an organization as
costs are not significant.
It is used for transportation to satisfy
such obligations where cost is not
the criteria.
VOGELS APPROXIMATION METHOD

To
W1 W2 W3 W4
Capacity
From
19 7 3 21

F1 100

15 21 18 6

F2 300

11 14 15 22

F3 200

Demand 150 100 200 150 600

Initial basic feasible solution
x13=100
x21=50
x23=100
x24=150
x31=100
x32=100
TTC=
(100*3)+(50*15)+(100*18)+(150*6)+(100*1
1)+(100*14)

=300+750+1800+900+1100+1400
=6250
 LEAST COST METHOD
TO W1 W2 W3 W4 CAPACIT
Y
FROM

F1 19 30 50 10 7

F2 70 30 40 60 9

F3 40 8 70 20 18

REQUIREM 5 8 7 14 43
ENT
 LCM OR MATRIX-MINIMA
METHOD
STEP 1 :-
DETERMINE THE SMALLEST COST IN THE COST MATRIX OF THE
TRANSPORTATION TABLE.LET IT BE CIJ. ALLOCATE XIJ =MIN(AI ,BJ)
IN THE CELL.

STEP 2 :-
IF ITH ROW GETS EXHAUSTED CROSS IT OUT ,AS A RESULT THE
TRANSPORTATION TABLE GETS REDUCED.
IF JTH COLUMN GETS EXHAUSTED CROSS IT OUT ,AS A RESULT
THE TRASPORTATION TABLE GETS REDUCED.

STEP 3 :-
REPEAT STEPS 1 AND 2 UNTIL THE ALL THE REQUIREMENTS
ARE SATISFIED.
 APPLICATION:-
LCM OR MATRIX MINIMA METHOD IS CERTAINLY
AN IMPROVEMENT OVER THE NWCR(NORTH-WEST
CORNER RULE) ,BUT IS NOT YET THE LOWEST
POSSIBLE SHIPPING SCHEDULE.
IT IS USED TO COMPUTE TRANSPORTAION ROUTE
IN SUCH A WAY SO AS TO MINIMISE COST BUT
NOT IN AN OPTIMUM WAY.
IN LCM METHOD REDUCTION OF TOTAL COST IS
DEFINTELY THE PRIMARY CRITERIA BUT IT IS NOT
DEALT IN A OPTIMUM WAY,WHICH CAN BE
DERIVED THROUGH VAM METHOD.
 APPLICATIONS OF VAM
It is used to compute transportation routes in
such a way as to minimize transportation cost
for finding out locations of warehouses.
It is used to find out locations of transportation
corporations depots where insignificant total
cost difference may not matter.
APPLICATIONS-TRANSPORTATION
METHOD
Minimize shipping costs from factories
to warehouses(or from warehouses to
retail outlets).
Determine lowest cost location for new
factory,warehouse,office,or other
outlet facility.
Find minimum cost production
schedule that satisfies firms demand
and production limitations.
 CONCLUSION
The transportation problem is one of
the most frequently encountered
application in real life situations and is
a special type of linear programming
problem.
The transportation problem indicates
the amount of consignment to be
transported from various origins to
different destinations so that the total
transportation cost is minimized
without violating the availability
THANK YOU