Dr.

Mohamed Abdel Salam

Operations Research (OR)

Chapter 8
Transportation, Assignment, and
Transshipment Problems

Slide 1
 Transportation, Assignment, and
Transshipment Problems
 A network model is one which can be represented by
a set of nodes, a set of arcs, and functions (e.g. costs,
supplies, demands, etc.) associated with the arcs
and/or nodes.
 Transportation, assignment, and transshipment
problems of this chapter, as well as the shortest route,
minimal spanning tree, and maximal flow problems
(Chapter 9) and PERT/CPM problems (Chapter 10)
are all examples of network problems.

Slide 2
 Transportation, Assignment, and
Transshipment Problems

 Each of the three models of this chapter

(transportation, assignment, and transshipment
models) can be formulated as linear programs and
solved by general purpose linear programming
Algorithms (simplex method).
 For each of the three models, if the right-hand side of
the linear programming formulations are all integers,
the optimal solution will be in terms of integer values
for the decision variables.
 However, there are many computer packages
(including The Management Scientist, DS, QSB) which
contain separate computer codes for these models
which take advantage of their network structure.
Slide 3
 Transportation Problem

 The transportation problem seeks to

minimize the total shipping costs of
transporting goods from m origins or sources
(each with a supply si) to n destinations
(each with a demand dj), when the unit
shipping cost from source, i, to a destination,
j, is cij.
 The network representation for a
transportation problem with two sources
and three destinations is given on the next
slide.
Slide 4
 Transportation Problem

 Network Representation

1 d1
c11
s1 1 c12
c13
2 d2
c21 c
22

s2 2
c23
3 d3

SOURCES DESTINATIONS

Slide 5
 Transportation Problem

 LP Formulation
The linear programming formulation in terms of the
amounts shipped from the sources to the destinations, xij ,
can be written as:
Min cijxij (total transportation cost)
ij
s.t. xij < si for each source i (supply constraints)
j
xij = dj for each destination j (demand constraints)
i
xij > 0 for all i and j (nonnegativity constraints)

Slide 6
 Transportation Problem

 To solve the transportation problem by its special

purpose algorithm, it is required that the sum of the
supplies at the sources equal the sum of the demands
at the destinations. If the total supply is greater than
the total demand, a dummy destination is added
with demand equal to the excess supply, and
shipping costs from all sources are zero. Similarly, if
total supply is less than total demand, a dummy
source is added.
 When solving a transportation problem by its special
purpose algorithm, unacceptable shipping routes are
given a cost of +M (a large number).

Slide 7
 Transportation Problem

 A transportation tableau is given below. Each cell

represents a shipping route (which is an arc on the
network and a decision variable in the LP
formulation), and the unit shipping costs are given in
an upper right hand box in the cell.

D1 D2 D3 Supply
15 30 20
S1 50

30 40 35
S2 30

Demand 25 45 10

Slide 8
 Problem formulation

 The LP model for this problem is as follows:

Min Z = 15 X11 + 30 X12 + 20 X13 + 30 X21 + 40X22 + 35X23
S.t.
X11 + X12 + X13 ≤ 50
Supply constraints
X21 + X22 + X23 ≤ 30

X11 + X21 = 25
X12 + X22 = 45
X13 + X23 = 10 demand constraints
X11, …, X23  0

Slide 9
 Transportation Problem

 The transportation problem is solved in two phases:

• Phase I -- Obtaining an initial feasible solution
• Phase II -- Moving toward optimality
 In Phase I, the Minimum-Cost Procedure can be used
to establish an initial basic feasible solution without
doing numerous iterations of the simplex method.
 In Phase II, the Stepping Stone, by using the MODI
method for evaluating the reduced costs may be used
to move from the initial feasible solution to the
optimal one.

Slide 10
 Initial Tableau

 There are many method for finding the initial tableau

for the transportation problem which are:
1. Northwest corner
2. Minimum cost of the row
3. Minimum cost of the column
4. Least cost
5. Vogle’s approximation method
6. Russell’s approximation method

Slide 11
 Northwest corner

 Northwest corner: Begin by selecting X11 (that is, start in the

northwest corner of the transportation tableau). Therefore, if
Xij was the last basic variable (occupied cell) selected, then
select Xij+1 (that is, move one column to the right) if source I
has any supply remaining. Otherwise, next select Xi+1 j (that
is, move one row down).
D1 D2 D3 Supply
15 30 20
S1 25 25 50

30 40 35
S2 20 10 30

Demand 25 45 10

Total cost is $2275

Slide 12
 Transportation Algorithm

 Phase I - Minimum-Cost Method

• Step 1: Select the cell with the least cost. Assign to this cell the
minimum of its remaining row supply or remaining column
demand.
• Step 2: Decrease the row and column availabilities by this
amount and remove from consideration all other cells in the
row or column with zero availability/demand. (If both are
simultaneously reduced to 0, assign an allocation of 0 to any
other unoccupied cell in the row or column before deleting
both.) GO TO STEP 1.
D1 D2 D3 Supply
15 30 20
Total S1 25 15 10 50
cost 30 40 35
is S2 30 30
$2225
Demand 25 45 10 Slide 13
 Transportation Algorithm

 Phase II - Stepping Stone Method

• Step 1: For each unoccupied cell, calculate the
reduced cost by the MODI method described below.
Select the unoccupied cell with the most
negative reduced cost. (For maximization problems
select the unoccupied cell with the largest reduced
cost.) If none, STOP.
• Step 2: For this unoccupied cell generate a stepping
stone path by forming a closed loop with this cell
and occupied cells by drawing connecting
alternating horizontal and vertical lines between
them.
Determine the minimum allocation where a
subtraction is to be made along this path.
Slide 14
 Transportation Algorithm

 Phase II - Stepping Stone Method (continued)

• Step 3: Add this allocation to all cells where
additions are to be made, and subtract this allocation
to all cells where subtractions are to be made along
the stepping stone path.
(Note: An occupied cell on the stepping
stone path now becomes 0 (unoccupied). If more
than one cell becomes 0, make only one unoccupied;
make the others occupied with 0's.)
GO TO STEP 1.

Slide 15
 Transportation Algorithm

 MODI Method (for obtaining reduced costs)

Associate a number, ui, with each row and vj with
each column.
• Step 1: Set u1 = 0.
• Step 2: Calculate the remaining ui's and vj's by
solving the relationship cij = ui + vj for occupied cells.
• Step 3: For unoccupied cells (i,j), the reduced cost =
cij - ui - vj.

Slide 16
 Example: BBC

Building Brick Company (BBC) has orders for 80

tons of bricks at three suburban locations as follows:
Northwood -- 25 tons, Westwood -- 45 tons, and
Eastwood -- 10 tons. BBC has two plants, each of which
can produce 50 tons per week.
How should end of week shipments be made to fill
the above orders given the following delivery cost per
ton:
Northwood Westwood Eastwood
Plant 1 24 30 40
Plant 2 30 40 42

Slide 17
 Example: BBC

 Initial Transportation Tableau

Since total supply = 100 and total demand = 80, a
dummy destination is created with demand of 20 and 0
unit costs.
Northwood Westwood Eastwood Dummy Supply
24 30 40 0
Plant 1 50

30 40 42 0
Plant 2 50

Demand 25 45 10 20

Slide 18
 Example: BBC

 Least Cost Starting Procedure

• Iteration 1: Tie for least cost (0), arbitrarily select x14.
Allocate 20. Reduce s1 by 20 to 30 and delete the
Dummy column.
• Iteration 2: Of the remaining cells the least cost is 24
for x11. Allocate 25. Reduce s1 by 25 to 5 and
eliminate the Northwood column.
• Iteration 3: Of the remaining cells the least cost is 30
for x12. Allocate 5. Reduce the Westwood column to
40 and eliminate the Plant 1 row.
• Iteration 4: Since there is only one row with two
cells left, make the final allocations of 40 and 10 to x22
and x23, respectively.

Slide 19
 Example: BBC

 Initial tableau

Northwood Westwood Eastwood Dummy Supply

24 30 40 0
Plant 1 25 5 20 50

30 40 42 0
Plant 2 40 10 50

Demand 25 45 10 20

Total transportation cost is $2770

Slide 20
 Example: BBC

 Iteration 1
• MODI Method
1. Set u1 = 0
2. Since u1 + vj = c1j for occupied cells in row 1, then
v1 = 24, v2 = 30, v4 = 0.
3. Since ui + v2 = ci2 for occupied cells in column 2,
then u2 + 30 = 40, hence u2 = 10.
4. Since u2 + vj = c2j for occupied cells in row 2, then
10 + v3 = 42, hence v3 = 32.

Slide 21
 Example: BBC

 Iteration 1
• MODI Method (continued)
Calculate the reduced costs (circled numbers on the
next slide) by cij - ui + vj.

Unoccupied Cell Reduced Cost

(1,3) 40 - 0 - 32 = 8
(2,1) 30 - 24 -10 = -4
(2,4) 0 - 10 - 0 = -10
•Since some of the reduced cost are negative, the current
solution is not optimal.
• Cell (2,4) has the most negative; therefore, it will be the
basic variable that must be occupied in the next iteration.
Slide 22
 Example: BBC

 Iteration 1 Tableau

Northwood Westwood Eastwood Dummy ui

24 30 40 0
Plant 1 25 5 +8 20 0

30 40 42 0
Plant 2 -4 40 10 -10 10

vj 24 30 32 0

Slide 23
 Example: BBC

 Iteration 1
• Stepping Stone Method
The stepping stone path for cell (2,4) is (2,4), (1,4),
(1,2), (2,2). The allocations in the subtraction cells are 20
and 40, respectively. The minimum is 20, and hence
reallocate 20 along this path. Thus for the next tableau:
x24 = 0 + 20 = 20 (0 is its current allocation)
x14 = 20 - 20 = 0 (blank for the next tableau)
x12 = 5 + 20 = 25
x22 = 40 - 20 = 20
The other occupied cells remain the same.

Slide 24
 Example: BBC

Northwood Westwood Eastwood Dummy Supply

24 30 40 0
Plant 1 25 25 50

30 40 42 0
Plant 2 20 10 20 50

Demand 25 45 10 20
New
quantity
Total transportation cost is $2570 = 2770 – 10 (20)
Reduced cost of
cell (2,4) Slide 25
 Example: BBC

 Iteration 2
• MODI Method
The reduced costs are found by calculating
the ui's and vj's for this tableau.
1. Set u1 = 0.
2. Since u1 + vj = cij for occupied cells in row 1, then
v1 = 24, v2 = 30.
3. Since ui + v2 = ci2 for occupied cells in column 2,
then u2 + 30 = 40, or u2 = 10.
4. Since u2 + vj = c2j for occupied cells in row 2, then
10 + v3 = 42 or v3 = 32; and, 10 + v4 = 0 or v4 = -10.

Slide 26
 Example: BBC

 Iteration 2
• MODI Method (continued)
Calculate the reduced costs (circled numbers on the
next slide) by cij - ui + vj.

Unoccupied Cell Reduced Cost

(1,3) 40 - 0 - 32 = 8
(1,4) 0 - 0 - (-10) = 10
(2,1) 30 - 10 - 24 = -4

Since there is still negative reduced cost for cell (2,1),

the solution is not optimal.
Cell (2,1) must be occupied
Slide 27
 Example: BBC

 Iteration 2 Tableau

Northwood Westwood Eastwood Dummy ui

24 30 40 0
Plant 1 25 25 +8 +10 0

30 40 42 0
Plant 2 -4 20 10 20 10

vj 24 30 36 -6

Slide 28
 Example: BBC

 Iteration 2
• Stepping Stone Method
The most negative reduced cost is = -4 determined
by x21. The stepping stone path for this cell is
(2,1),(1,1),(1,2),(2,2). The allocations in the subtraction
cells are 25 and 20 respectively. Thus the new solution
is obtained by reallocating 20 on the stepping stone
path. Thus for the next tableau:
x21 = 0 + 20 = 20 (0 is its current allocation)
x11 = 25 - 20 = 5
x12 = 25 + 20 = 45
x22 = 20 - 20 = 0 (blank for the next tableau)
The other occupied cells remain the same.
Slide 29
 Example: BBC

Northwood Westwood Eastwood Dummy Supply

24 30 40 0
Plant 1 5 45 50

30 40 42 0
Plant 2 20 10 20 50

Demand 25 45 10 20

Total cost is $2490 = 2570 - 4(20)

Slide 30
 Example: BBC

 Iteration 3
• MODI Method
The reduced costs are found by calculating
the ui's and vj's for this tableau.
1. Set u1 = 0
2. Since u1 + vj = c1j for occupied cells in row 1, then
v1 = 24 and v2 = 30.
3. Since ui + v1 = ci1 for occupied cells in column 2,
then u2 + 24 = 30 or u2 = 6.
4. Since u2 + vj = c2j for occupied cells in row 2, then
6 + v3 = 42 or v3 = 36, and 6 + v4 = 0 or v4 = -6.

Slide 31
 Example: BBC

 Iteration 3
• MODI Method (continued)
Calculate the reduced costs (circled numbers on the
next slide) by cij - ui + vj.

Unoccupied Cell Reduced Cost

(1,3) 40 - 0 - 36 = 4
(1,4) 0 - 0 - (-6) = 6
(2,2) 40 - 6 - 30 = 4

Since all the reduced cost are nonnegative, the current

solution is optimal
Slide 32
 Example: BBC

 Iteration 3 Tableau
Since all the reduced costs are non-negative, this is
the optimal tableau.

Northwood Westwood Eastwood Dummy ui

24 30 40 0
Plant 1 5 45 +4 +6 0

30 40 42 0
Plant 2 20 +4 10 20 6

vj 24 30 36 -6

Slide 33
 Example: BBC

 Optimal Solution

From To Amount Cost

Plant 1 Northwood 5 120
Plant 1 Westwood 45 1,350
Plant 2 Northwood 20 600
Plant 2 Eastwood 10 420
Total Cost = $2,490

Slide 34
 Assignment Problem

 An assignment problem seeks to minimize the total cost

assignment of m workers to m jobs, given that the cost
of worker i performing job j is cij.
 It assumes all workers are assigned and each job is
performed.
 An assignment problem is a special case of a
transportation problem in which all supplies and all
demands are equal to 1; hence assignment problems
may be solved as linear programs.
 The network representation of an assignment problem
with three workers and three jobs is shown on the next
slide.

Slide 35
 Assignment Problem

 Network Representation

c11
1 1
c12
c13

c21
2
c22 2
c23

c32
c31
3 c33 3

WORKERS JOBS

Slide 36
 Assignment Problem

 Linear Programming Formulation

Min cijxij
ij
s.t. xij = 1 for each worker i
j
xij = 1 for each job j
i
xij = 0 or 1 for all i and j.

• Note: A modification to the right-hand side of the

first constraint set can be made if a worker is
permitted to work more than 1 job.

Slide 37
 Example: Hungry Owner
A contractor pays his subcontractors a fixed fee
plus mileage for work performed. On a given day the
contractor is faced with three electrical jobs associated
with various projects. Given below are the distances
between the subcontractors and the projects.
Project
A B C
Westside 50 36 16
Subcontractors Federated 28 30 18
Goliath 35 32 20
Universal 25 25 14
How should the contractors be assigned to minimize
total distance (and total cost)?

Slide 38
 Example: Hungry Owner

 Network Representation
50
West. 36
A

16

28
30
Fed. B
18

35 32
20
Gol. C

25 25
14
Univ.
Slide 39
 Example: Hungry Owner

 LP Formulation
• Decision Variables Defined
xij = 1 if subcontractor i is assigned to project j
= 0 otherwise

where: i = 1 (Westside), 2 (Federated),

3 (Goliath), and 4 (Universal)
j = 1 (A), 2 (B), and 3 (C)

Slide 40
 Example: Hungry Owner

 LP Formulation
• Objective Function
Minimize total distance:
Min 50x11 + 36x12 + 16x13 + 28x21 + 30x22 + 18x23
+ 35x31 + 32x32 + 20x33 + 25x41 + 25x42 + 14x43

Slide 41
 Example: Hungry Owner

 LP Formulation
• Constraints
x11 + x12 + x13 < 1 (no more than one
x21 + x22 + x23 < 1 project assigned
x31 + x32 + x33 < 1 to any one
x41 + x42 + x43 < 1 subcontractor)
x11 + x21 + x31 + x41 = 1 (each project must
x12 + x22 + x32 + x42 = 1 be assigned to just
x13 + x23 + x33 + x43 = 1 one subcontractor)
all xij > 0 (non-negativity)

Slide 42
 Example: Hungry Owner

 Optimal Assignment

Subcontractor Project Distance

Westside C 16
Federated A 28
Universal B 25
Goliath (unassigned)
Total Distance = 69 miles

Slide 43
 Variations of Assignment Problem

 Total number of agents not equal to total number of

tasks
 Maximization objective function
 Unacceptable assignments

Slide 44
 Hungarian Method

 The Hungarian method solves minimization

assignment problems with m workers and m jobs.
 Special considerations can include:
• number of workers does not equal the number of
jobs -- add dummy workers or jobs with 0
assignment costs as needed
• worker i cannot do job j -- assign cij = +M
• maximization objective -- create an opportunity loss
matrix subtracting all profits for each job from the
maximum profit for that job before beginning the
Hungarian method

Slide 45
 Hungarian Method

 Step 1: For each row, subtract the minimum number in

that row from all numbers in that row.
 Step 2: For each column, subtract the minimum number
in that column from all numbers in that column.
 Step 3: Draw the minimum number of lines to cover all
zeroes. If this number = m, STOP -- an assignment can be
made.
 Step 4: Determine the minimum uncovered number (call
it d).
• Subtract d from uncovered numbers.
• Add d to numbers covered by two lines.
• Numbers covered by one line remain the same.
• Then, GO TO STEP 3.
Slide 46
 Hungarian Method

 Finding the Minimum Number of Lines and

Determining the Optimal Solution
• Step 1: Find a row or column with only one unlined
zero and circle it. (If all rows/columns have two or
more unlined zeroes choose an arbitrary zero.)
• Step 2: If the circle is in a row with one zero, draw a
line through its column. If the circle is in a column
with one zero, draw a line through its row. One
approach, when all rows and columns have two or
more zeroes, is to draw a line through one with the
most zeroes, breaking ties arbitrarily.
• Step 3: Repeat step 2 until all circles are lined. If this
minimum number of lines equals m, the circles
provide the optimal assignment.
Slide 47
 Example: Hungry Owner

A contractor pays his subcontractors a fixed fee

plus mileage for work performed. On a given day the
contractor is faced with three electrical jobs associated
with various projects. Given below are the distances
between the subcontractors and the projects.
Projects
A B C
Westside 50 36 16
Subcontractors Federated 28 30 18
Goliath 35 32 20
Universal 25 25 14

How should the contractors be assigned to

minimize total costs?
Slide 48
 Example: Hungry Owner

 Network Representation (note the dummy project)

50
West. 36
A

0 16

28
Subcontractors

30
Fed. B
18

Projects
0

35 32
20
Gol. C
0

25 25
14
Univ. Dum.
0
Slide 49
 Example: Hungry Owner

 Initial Tableau Setup

Since the Hungarian algorithm requires that there
be the same number of rows as columns, add a Dummy
column so that the first tableau is:

A B C Dummy
Westside 50 36 16 0
Federated 28 30 18 0
Goliath 35 32 20 0
Universal 25 25 14 0

Slide 50
 Example: Hungry Owner

 Step 1: Subtract minimum number in each row from all

numbers in that row. Since each row has a zero, we
would simply generate the same matrix above.
 Step 2: Subtract the minimum number in each column
from all numbers in the column. For A it is 25, for B it
is 25, for C it is 14, for Dummy it is 0. This yields:

A B C Dummy
Westside 25 11 2 0
Federated 3 5 4 0
Goliath 10 7 6 0
Universal 0 0 0 0

Slide 51
 Example: Hungry Owner

 Step 3: Draw the minimum number of lines to cover all

zeroes. Although one can "eyeball" this minimum, use
the following algorithm. If a "remaining" row has only
one zero, draw a line through the column. If a
remaining column has only one zero in it, draw a line
through the row.
A B C Dummy
Westside 25 11 2 0
Federated 3 5 4 0
Goliath 10 7 6 0
Universal 0 0 0 0

 Step 4: The minimum uncovered number is 2 (circled).

Slide 52
 Example: Hungry Owner

 Step 5: Subtract 2 from uncovered numbers; add 2 to all

numbers covered by two lines. This gives:

A B C Dummy
Westside 23 9 0 0
Federated 1 3 2 0
Goliath 8 5 4 0
Universal 0 0 0 2

Slide 53
 Example: Hungry Owner

 Step 3: Draw the minimum number of lines to cover all

zeroes.
A B C Dummy
Westside 23 9 0 0
Federated 1 3 2 0
Goliath 8 5 4 0
Universal 0 0 0 2

 Step 4: The minimum uncovered number is 1 (circled).

Slide 54
 Example: Hungry Owner

 Step 5: Subtract 1 from uncovered numbers. Add 1 to

numbers covered by two lines. This gives:

A B C Dummy
Westside 23 9 0 1
Federated 0 2 1 0
Goliath 7 4 3 0
Universal 0 0 0 3

Slide 55
 Example: Hungry Owner

 Step 4: The minimum number of lines to cover all 0's is

four. Thus, there is a minimum-cost assignment of 0's
with this tableau. The optimal assignment is:

Subcontractor Project Distance

Westside C 16
Federated A 28
Goliath (unassigned)
Universal B 25
Total Distance = 69 miles

Slide 56
 Transshipment Problem

 Transshipment problems are transportation problems

in which a shipment may move through intermediate
nodes (transshipment nodes)before reaching a
particular destination node.
 Transshipment problems can be converted to larger
transportation problems and solved by a special
transportation program.
 Transshipment problems can also be solved by general
purpose linear programming codes.
 The network representation for a transshipment
problem with two sources, three intermediate nodes,
and two destinations is shown on the next slide.

Slide 57
 Transshipment Problem

 Network Representation

3 c36
c13 c37
s1 1 c14 6 d1
c15 c46
4 c47

c23 c24
c56 7 d2
s2 2
c25
5 c57

SOURCES INTERMEDIATE DESTINATIONS

NODES
“Transshipment points” Slide 58
 Transshipment Problem

 Linear Programming Formulation

xij represents the shipment from node i to node j
Min cijxij
ij

s.t. xij < si for each source i

j

xik - xkj = 0 for each intermediate

i j node k

xij = dj for each destination j

i
xij > 0 for all i and j

Slide 59
 Example: Transshipping

Thomas Industries and Washburn Corporation

supply three firms (Zrox, Hewes, Rockwright) with
customized shelving for its offices. They both order
shelving from the same two manufacturers, Arnold
Manufacturers and Supershelf, Inc.
Currently weekly demands by the users are 50 for
Zrox, 60 for Hewes, and 40 for Rockwright. Both
Arnold and Supershelf can supply at most 75 units to
its customers.
Additional data is shown on the next slide.

Slide 60
 Example: Transshipping

Because of long standing contracts based on past

orders, unit costs from the manufacturers to the
suppliers are:
Thomas Washburn
Arnold 5 8
Supershelf 7 4

The cost to install the shelving at the various

locations are:
Zrox Hewes Rockwright
Thomas 1 5 8
Washburn 3 4 4

Slide 61
 Example: Transshipping

 Network Representation
ZROX
Zrox 50

5 1
75 ARNOLD
Arnold Thomas 5

8 8
Hewes
HEWES 60

3 4
7
Super Wash-
WASH
75 Shelf Burn
BURN
4 4
Rock-
Wright 40

Slide 62
 Example: Transshipping

 Linear Programming Formulation

• Decision Variables Defined
xij = amount shipped from manufacturer i to supplier j
xjk = amount shipped from supplier j to customer k
where i = 1 (Arnold), 2 (Supershelf)
j = 3 (Thomas), 4 (Washburn)
k = 5 (Zrox), 6 (Hewes), 7 (Rockwright)
• Objective Function Defined
Minimize Overall Shipping Costs:
Min 5x13 + 8x14 + 7x23 + 4x24 + 1x35 + 5x36 + 8x37
+ 3x45 + 4x46 + 4x47

Slide 63
 Example: Transshipping

Constraints Defined
Amount Out of Arnold: x13 + x14 < 75
Amount Out of Supershelf: x23 + x24 < 75
Amount Through Thomas: x13 + x23 - x35 - x36 - x37 = 0
Amount Through Washburn: x14 + x24 - x45 - x46 - x47 = 0
Amount Into Zrox: x35 + x45 = 50
Amount Into Hewes: x36 + x46 = 60
Amount Into Rockwright: x37 + x47 = 40

Non-negativity of Variables: xij > 0, for all i and j.

Slide 64
Solving the transshipment problem using transportation
algorithm

 Supply point: is a point that can send

goods to another point but can not
receive goods from any other point
 Demand point: is a point that can receive
goods form other points but cannot send
goods to any other point.
 Transshipment point: is a point that can
both receive goods from other points and
send goods to other points

Slide 65
 Solving the transshipment problem using transportation
algorithm
 a transshipment problem can be transformed to a balanced
transportation problem by using the following procedure:
• Step 1: if necessary, add a dummy demand point or a dummy
supply point as needed
• Step 2: construct a transportation tableau as follows:
 A row in the tableau will be needed for each supply point

and transshipment point.

 A column will be needed for each demand point and

transshipment point
 Each supply point will have a supply equal to its original

supply, and each demand point will have a demand equals

to its original demand.
 each transshipment point will have

supply = its original supply + total available supply, and

demand = its original demand + total available supply
 Then the problem can be solved as a transportation problem

Slide 66
 Example: transshipping
 The balanced transportation tableau for the transshipment problem will
be as follows:

Zrox Hewes Rockwright Thomas washburn Supply

Arnold M M M 5 8 75

Supper M M M 7 4 75
shell
Thomas 1 5 8 0 M 150

Washburn 3 4 4 M 0 150

Demand 50 60 40 150 150 Total = 450

• Where M is a very large number and used when the route is not valid
• Zero cost is used from a destination to itself.
•There is no need for dummy row or column, since the problem is balanced
Slide 67