Transportation Method of Linear

programming: Obtaining the Initial

Feasible Solution

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 Transportation Method of Linear
programming
 The Transportation Method of linear programming is
applied to the problems related to the study of the efficient
transportation routes i.e. how efficiently the product from
different sources of production is transported to the different
destinations, such as the total transportation cost is minimum.
 Here origin means the place where the product is originated or
manufactured for the ultimate sales while the places where the
product is required to be sold is called destination.

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 Module Objectives:
 Define Transportation Method of Linear
programming
 Itemized the Steps in Transportation Method of
Linear programming
 Be able to obtain the initial feasible solution
through North-West Corner, Least Cost Method
and Vogel’s Approximation Method

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Steps in Transportation Method of Linear
programming
1. Obtaining the initial feasible solution, which means
identifying the solution that satisfies the requirements of
demand and supply.
There are several methods through which the initial feasible
solution can be obtained; these are:
 North-West Corner
 Least Cost Method
 Vogel’s Approximation Method
Note: It is to be ensured that the number of cells occupied should
be equal to m+n-1, where “m” is the number of rows while
“n” is the number of columns.

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Steps in Transportation Method of Linear
programming
2. Testing the optimality of the initial feasible solution. Once
the feasible solution is obtained, the next step is to check
whether it is optimum or not.

There are two methods used for testing the optimality:

 Stepping-stone Method
 Modified Distribution Method (MODI)

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Steps in Transportation Method of Linear
programming
3. The final step is to revise the solution until the optimum
solution is obtained.

The two most common objectives of transportation problem

could be: i) maximize the profit of transporting “n” units of
product to the destination “y”, ii) Minimize the cost of
shipping “n” units of product to the destination “y”.

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 North-West Corner Rule

The North-West Corner Rule is a method adopted to compute

the initial feasible solution of the transportation problem. The
name North-west corner is given to this method because the
basic variables are selected from the extreme left corner.

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 North-West Corner Rule

The concept of North-West Corner can be well understood

through a transportation problem given below:

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 North-West Corner Rule

In the table, three sources A, B and C with the production

capacity of 50 units, 40 units, 60 units of product respectively
is given. Every day the demand of three retailers D, E, F is to
be furnished with at least 20 units, 95 units and 35 units of
product respectively. The transportation costs are also given in
the matrix.
The prerequisite condition for solving the transportation problem
is that demand should be equal to the supply. In case the
demand is more than supply, then dummy origin is added to
the table. The supply of dummy origin will be equal to the
difference between the total supply and total demand. The cost
associated with the dummy origin will be zero.

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 North-West Corner Rule

Similarly, in case the supply is more than the

demand, then dummy source is created whose
demand will be equivalent to the difference
between supply and demand. Again the cost
associated with the dummy source will be zero.

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 Procedure in North-West Corner Rule

1. Select the north-west or extreme left corner of the

matrix, assign as many units as possible to cell AD,
within the supply and demand constraints. Such as 20
units are assigned to the first cell, that satisfies the
demand of destination D while the supply is in surplus.
2. Now move horizontally and assign 30 units to the
cell AE. Since 30 units are available with the source
A, the supply gets fully saturated.

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Procedure in North-West Corner Rule

3. Now move vertically in the matrix and assign 40

units to Cell BE. The supply of source B also gets
fully saturated.
4. Again move vertically, and assign 25 units to cell CE,
the demand of destination E is fulfilled.
5. Move horizontally in the matrix and assign 35 units
to cell CF, both the demand and supply of origin and
destination gets saturated. Now the total cost can be
computed.

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North-West Corner Rule

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 North-West Corner Rule

The Total cost can be computed by multiplying the units

assigned to each cell with the concerned
transportation cost. Therefore,

Total Cost = 20*5+ 30*8+ 40*6+ 25*9+ 35*6

= Rs 1015

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 Least Cost Method

The Least Cost Method is another method used to

obtain the initial feasible solution for the
transportation problem.
Here, the allocation begins with the cell which has the
minimum cost.
The lower cost cells are chosen over the higher-cost cell
with the objective to have the least cost of
transportation.

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 Least Cost Method

The Least Cost Method is considered to produce more

optimal results than the North-west Corner because it
considers the shipping cost while making the
allocation, whereas the North-West corner method
only considers the availability and supply
requirement and allocation begin with the extreme
left corner, irrespective of the shipping cost.

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 Least Cost Method

Let’s understand the concept of Least Cost method

through a problem given below:

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 Least Cost Method

In the given matrix, the supply of each source A, B, C is

given Viz. 50units, 40 units, and 60 units respectively.

The weekly demand for three retailers D, E, F i.e. 20

units, 95 units and 35 units is given respectively. The
shipping cost is given for all the routes.

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 Steps in Least Cost Method

1. The minimum cost in the matrix is Rs 3, but there is a

tie in the cell BF, and CD, now the question arises in
which cell we shall allocate. Generally, the cost
where maximum quantity can be assigned should be
chosen to obtain the better initial solution. Therefore,
35 units shall be assigned to the cell BF. With this, the
demand for retailer F gets fulfilled, and only 5 units
are left with the source B.
2. Again the minimum cost in the matrix is Rs 3.
Therefore, 20 units shall be assigned to the cell CD.
With this, the demand of retailer D gets fulfilled.
Only 40 units are left with the source C.
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 Steps in Least Cost Method

3. The next minimum cost is Rs 4, but however, the

demand for F is completed, we will move to the next
minimum cost which is 5. Again, the demand of D is
completed. The next minimum cost is 6, and there is a
tie between three cells. But however, no units can be
assigned to the cells BD and CF as the demand for
both the retailers D and F are saturated. So, we shall
assign 5 units to Cell BE. With this, the supply of
source B gets saturated.

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 Steps in Least Cost Method

4. The next minimum cost is 8, assign 50 units to the

cell AE. The supply of source A gets saturated.

5. The next minimum cost is Rs 9; we shall assign 40

units to the cell CE. With his both the demand and
supply of all the sources and origins gets saturated.

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Steps in Least Cost Method

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 Least Cost Method
The total cost can be calculated by multiplying the assigned
quantity with the concerned cost of the cell. Therefore,

Total Cost = 50*8 + 5*6 + 35*3 +20*3 +40*9 = Rs 955.

Note: The supply and demand should be equal and in

case supply are more, the dummy source is added in the
table with demand being equal to the difference
between supply and demand, and the cost remains zero.
Similarly, in case the demand is more than supply, then
dummy destination or origin is added to the table with
the supply equal to the difference in quantity demanded
and supplied and the cost being zero.
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 Vogel’s Approximation Method
The Vogel’s Approximation Method or VAM is an
iterative procedure calculated to find out the initial
feasible solution of the transportation problem.

Like Least cost Method, here also the shipping cost is

taken into consideration, but in a relative sense.

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Steps in Vogel’s Approximation Method

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 Vogel’s Approximation Method
Illustrations
1. First of all the difference between
two least cost cells are calculated
for each row and column, which
can be seen in the iteration given
for each row and column. Then
the largest difference is selected,
which is 4 in this case. So,
allocate 20 units to cell BD, since
the minimum cost is to be chosen
for the allocation. Now, only 20
units are left with the source B.

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 Vogel’s Approximation Method
Illustrations
2. Column D is deleted, again
the difference between the
least cost cells is calculated
for each row and column, as
seen in the iteration below.
The largest difference value
comes to be 3, so allocate 35
units to cell AF and 15 units
to the cell AE. With this, the
Supply and demand of source
A and origin F gets saturated,
so delete both the row A and
Column F. 2-28
 Vogel’s Approximation Method
Illustrations
3. Now, single column E is
left, since no difference
can be found out, so
allocate 60 units to the
cell CE and 20 units to
cell BE, as only 20 units
are left with source B.
Hence the demand and
supply are completely
met.

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 Vogel’s Approximation Method

Now the total cost can be computed, by multiplying the units

assigned to each cell with the cost concerned. Therefore,

Total Cost = 20*3 + 35*1 + 15*4 + 60*4 + 20*8 = Rs 555

Note: Vogel’s Approximation Method is also called as Penalty

Method because the difference costs chosen are nothing but the
penalties of not choosing the least cost routes.

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 Activities/Assessments
Obtaining the initial feasible solution through the
following methods:
 North-West Corner
 Least Cost Method
 Vogel’s Approximation Method

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