TRANSPORTATION PROBLEM

Finding Initial Basic Feasible

Solution
 North-West Corner Method
Step1: Select the upper left (north-west) cell of the
transportation matrix and allocate the maximum possible
value to X11 which is equal to min(a1,b1).
Step2:
• If allocation made is equal to the supply available at the
first source (a1 in first row), then move vertically down to
the cell (2,1).
• If allocation made is equal to demand of the first
destination (b1 in first column), then move horizontally to
the cell (1,2).
• If a1=b1 , then allocate X11= a1 or b1 and move to cell (2,2).
Step3: Continue the process until an allocation is made in
the south-east corner cell of the transportation table.
Example: Solve the Transportation Table to find Initial
Basic Feasible Solution using North-West Corner Method.

Total Cost =19*5+30*2+30*6+40*3+70*4+20*14

= Rs. 1015

D1 D2 D3 D4 Supply
19 30 50 10
S1 7
5 2
70 30 40 60
S2 9
6 3
40 8 70 20
S3 18
4 14
Demand 5 8 7 14 34
 Least Cost Method
Step1: Select the cell having lowest unit cost in the entire
table and allocate the minimum of supply or demand values
in that cell.
Step2: Then eliminate the row or column in which supply or
demand is exhausted. If both the supply and demand
values are same, either of the row or column can be
eliminated.
In case, the smallest unit cost is not unique, then select the
cell where maximum allocation can be made.
Step3: Repeat the process with next lowest unit cost and
continue until the entire available supply at various sources
and demand at various destinations is satisfied.
 D1 D2 D3 D4 Supply
19 30 50 10
S1 7

70 30 40 60
S2 9

40 8 70 20
S3 18
8
Demand 5 8 7 14 34

D1 D3 D4 Supply D1 D3 D4 Supply
19 50 10
S1 7 70 40 60
7 S2 9
70 40 60
S2 9
40 70 20
40 70 20
S3 10
S3 10 7
Demand 34
Demand 5 7 7 34
5 7 14

D1 D3 Supply D1 Supply
70 40 70
S2 9 S2 2
7 2
40 70 40
S3 3
S3 3 3
Demand 5 34
Demand 5 7 34
The total transportation cost obtained by this method
= 8*8+10*7+20*7+40*7+70*2+40*3
= Rs.814
Here, we can see that the Least Cost Method involves a
lower cost than the North-West Corner Method.
 Vogel’s Approximation Method
Step1: Calculate penalty for each row and column by taking the
difference between the two smallest unit costs. This penalty or
extra cost has to be paid if one fails to allocate the minimum
unit transportation cost.
Step2: Select the row or column with the highest penalty and
select the minimum unit cost of that row or column. Then,
allocate the minimum of supply or demand values in that cell. If
there is a tie, then select the cell where maximum allocation
could be made.
Step3: Adjust the supply and demand and eliminate the satisfied
row or column. If a row and column are satisfied
simultaneously, only of them is eliminated and the other one is
assigned a zero value.Any row or column having zero supply
or demand, can not be used in calculating future penalties.
Step4: Repeat the process until all the supply sources and
demand destinations are satisfied.
 D1 D2 D3 D4 Supply Row Diff.
19 30 50 10
S1 7 9

70 30 40 60
S2 9 10

40 8 70 20
S3 18 12
8
Demand 5 8 7 14 34
Col.Diff. 21 22 10 10

D1 D3 D4 Supply Row Diff. D3 D4 Supply Row Diff.

19 50 10 50 10
S1 7 9 S1 2 40
5
70 40 60 40 60
S2 9 20 S2 9 20

40 70 20 70 20
S3 10 20 S3 10 50
10
Demand 34 Demand 7 14 34
5 7 14
Col.Diff. Col.Diff. 10 10
21 10 10

D3 D4 Supply Row Diff.

D3 D4 Supply Row Diff.
50 10
S1 2 40 40 60
2 S2 9 20
40 60 7 2
S2 9 20
Demand 7 2 34
Demand 7 4 34 Col.Diff.
Col.Diff. 10 50
The total transportation cost obtained by this method
= 8*8+19*5+20*10+10*2+40*7+60*2
= Rs.779
Here, we can see that Vogel’s Approximation Method
involves the lowest cost than North-West Corner Method
and Least Cost Method and hence is the most preferred
method of finding initial basic feasible solution.
Example 1(North West
method)
Example 2(Least Cost
method)
 Example 3(Vogel
approximation method)
METHOD OF POTENTIALS
(Multipliers)
Bfs-basic feasible solution
Example