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The Transportation Model - Formulations

The problem formulates a transportation model to determine the optimal production schedule for a company to supply widgets over 3 weeks to meet customer demand while minimizing costs and inventory. There are 6 sources of production (regular and overtime for 3 weeks) and 4 destinations (demand for 3 weeks plus a dummy). The costs and capacities are entered into a transportation tableau to solve the linear program.

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440 views26 pages

The Transportation Model - Formulations

The problem formulates a transportation model to determine the optimal production schedule for a company to supply widgets over 3 weeks to meet customer demand while minimizing costs and inventory. There are 6 sources of production (regular and overtime for 3 weeks) and 4 destinations (demand for 3 weeks plus a dummy). The costs and capacities are entered into a transportation tableau to solve the linear program.

Uploaded by

Potnuru Vinay
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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The Transportation Model

Formulations

The Transportation Model


The transportation model is a special class of LPPs that deals with transporting(=shipping) a commodity from sources (e.g. factories) to destinations (e.g. warehouses). The objective is to determine the shipping schedule that minimizes the total shipping cost while satisfying supply and demand limits. We assume that the shipping cost is proportional to the number of units shipped on a given route.

We assume that there are m sources 1,2, , m and n destinations 1, 2, , n. The cost of shipping one unit from Source i to Destination j is cij. We assume that the availability at source i is ai (i=1, 2, , m) and the demand at the destination j is bj (j=1, 2, , n). We make an important assumption: the problem is a balanced one. That is

a b
i 1 i j 1

That is, total availability equals total demand.

We can always meet this condition by introducing a dummy source (if the total demand is more than the total supply) or a dummy destination (if the total supply is more than the total demand).
Let xij be the amount of commodity to be shipped from the source i to the destination j.

Thus the problem becomes the LPP


Minimize subject to

z
i 1

c
j 1

ij

xij

x
j 1 m

ij

ai (i 1,2,...,m) b j ( j 1,2,...,n)

x
i 1

ij

xij 0

Thus there are mn decision variables xij and m+n constraints. Since the sum of the first m constraints equals the sum of the last n constraints (because the problem is a balanced one), one of the constraints is redundant and we can show that the other m+n-1 constraints are LI. Thus any BFS will have only m+n-1 nonzero variables.
Though we can solve the above LPP by Simplex method, we solve it by a special algorithm called the transportation algorithm. We present the data in an mn tableau as explained below.

1
S o u r c e 1
c11 c21

Destination 2 .
c12 c22

n
c1n c2n

Supply
a1 a2

2
.

.
m
cm1 cm2 cmn

am

Demand

b1

b2

bn

Formulation of Transportation Models


Example 5.1-2 MG Auto has three plants in Los Angeles, Detroit, and New Orleans, and two major distribution centers in Denver and Miami. The capacities of the three plants during the next quarter are 1000, 1300 and 1200 cars. The quarterly demands at the two distribution centers are 2300 and 1400 cars. The transportation cost per car from Los Angeles to Denver and Miami are $80 and $215 respectively. The corresponding figures from Detroit and New Orleans are 100, 108 and 102, 68 respectively.

Formulate the transportation Model. Since the total demand = 3700 > 3500 (Total supply) we introduce a dummy supply with availability 3700-3500=200 units to make the problem a balanced one. If a destination receives u units from the dummy source, it means that that destination gets u units less than what it demanded. We usually put the cost per unit of transporting from a dummy source as zero (unless some restrictions are there). Thus we get the transportation tableau

Destination
Denver Miami Supply
80 215

S o u r c e

Los Angeles Detroit New Orleans Dummy

1000 1300

100
102

108
68

1200 200

Demand 2300

1400

We write inside the (i,j) cell the amount to be shipped from source i to destination j. A blank inside a cell indicates no amount was shipped.

Problem 5 Problem Set 5.1A Page 169


In the previous problem, penalty costs are levied at the rate of $200 and $300 for each undelivered car at Denver and Miami respectively. Additionally no deliveries are made from the Los Angeles plant to the Miami distribution center. Set up the transportation model. The above imply that the "cost" of transporting a car from the dummy source to Denver and Miami are respectively 200 and 300. The second condition means we put a "high" transportation cost from Los Angeles to Miami. We thus get the tableau

Destination
Denver Miami Supply
80 M

S o u r c e

Los Angeles Detroit New Orleans Dummy

1000 1300 1200 200

100
102 200

108
68 300

Demand 2300

1400

Note: M indicates a very "big" positive number. In TORA it is denoted by "infinity".

Problem 8 Problem Set 5.1A Page 170


Three refineries with daily capacities of 6,5, and 8 million gallons, respectively, supply three distribution areas with daily demands of 4,8, and 7 million gallons, respectively.Gasoline is distributed to the three distribution areas through a network of pipelines. The transportation cost is 10 cents per 1000 gallons per pipeline mile. The table below gives the mileage between the refineries and the distribution areas. Refinery 1 is not connected to the distribution area 3.

Distribution Area 1 2 3
1 Refinery 2 3 120 300 200 180 100 250 80 120

Construct the associated transportation model. (Solution in the next slide)

Destination Distribution Area S o u r c e


1 2 3 1
12 18 M

Supply 6 5 8

Refinery 2
3 Demand

30
20

10
25

8
12

The problem is a balanced one. M indicates a very "big" positive number. The total cost will be 1000*

c
i 1 j 1

ij

xij

Problem 10 Problem Set 5.1A Page 170


In the previous problem, suppose that the daily demand at area 3 drops to 4 million gallons. Surplus production at refineries 1 and 2 is diverted to other distribution areas by truck. The transportation cost per 100 gallons is $1.50 from refinery 1 and $2.20 from refinery 2. Refinery 3 can divert its surplus production to other chemical processes within the plant. Formulate the problem as a transportation model. We introduce a dummy destination. Solution follows.

S o 1 u r Refinery 2 c 3 e
Demand

1
12 30 20

Destination Distribution Area


2 3
Dummy Supply 15 22 0 18 10 25 M 8 12

6 5 8 3

M indicates a very "big" positive number. The total cost will be 1000*

c
i 1 j 1

ij

xij

Problem 11 Problem Set 5.1 A Pages 170-171


Three orchards supply crates of oranges to four retailers. The daily demand at the four retailers is 150,150,400, and 100 crates, respectively. Supply at the three orchards is dictated by available regular labor and is estimated at 150, 200, and 250 crates daily. However, both orchards 1 and 2 have indicated that they could supply more crates, if necessary by using overtime labor. Orchard 3 does not offer this option. The transportation costs (in dollars) per crate from the orchards to the retailers are given in Table below.

1 Orchard 2 3

1 1 2 1

Retailer 2 3 2 3 4 1 3 5

4 2 2 3

Formulate the problem as a transportation model. Since the orchards 1, 2 can supply more crates with overtime labor, we increase their capacities to 150+200=350 and 200+200=400 respectively (as initially the total supply fell short by 200). But then to balance the problem we add a dummy destination. The tableau follows.

S o u r c e

1 2 3 4 O 1 2 3 2 r 1 c 4 1 2 h 2 2 a 1 3 5 3 r 3 d Demand 150 150 400 100

Destination Retailer

Dummy Supply 0

350
400 250

0 M

200

Problem 8.1-9 from Hillier and Lieberman (Introduction to Operations Research, 7th Edition)
The Build-Em-Fast Company has agreed to supply its best customer with three widgets during each of the next 3 weeks, even though producing them will require some overtime work. The relevant production data are as follows:
Week 1 2 3 Max Production Max Production Prod Cost / unit Regular Time Overtime Regular Time 2 3 1 2 2 2 $300 $500 $400

The cost / unit produced overtime for each week is $100 more than for regular time. The cost of storage is $50 / unit for each week it is stored. There is already an inventory of 2 widgets on hand currently, but the company does not want to retain any widgets in inventory after the 3 weeks. Formulate the problem as a transportation problem. There are 6 sources namely widgets produced regular time and overtime for the three weeks. Also there are 3 destinations viz. demand for the three weeks.

We let xij as the number of units produced regular time in week (i+1)/2 for use in week j (i=1,3,5; j=1,2,3). We let xij as the number of units produced overtime in week i/2 for use in week j (i=2,4,6; j=1,2,3). Thus

x11 x12 x13 2

x21 x22 x23 2 x31 x32 x33 3 x41 x42 x43 2 x51 x52 x53 1 x61 x62 x63 2

To make these equalities we add a dummy destination and let xi4 as the amount transported from Source i to this dummy. Thus the availabilities at the 6 sources are 2,2,3,2,1,2 respectively. The demands at the three destinations (=demand for the three weeks) are 1,3,3 respectively (as the initial inventory is 2 widgets).
To make the problem balanced we add demand 12 7 = 5 at the dummy destination.

The cost per unit, cij are as follows:


c11 300 c21 400 c31 M c41 M c51 M c61 M c12 350 c22 450 c32 500 c42 600 c52 M c62 M c13 400 c23 500 c33 550 c43 650 c53 400 c63 500 c14 0 c24 0 c34 0 c44 0 c54 0 c64 0

These are written in a transportation tableau.

Demand for Week 1 2 3 Dummy Supply


Prod.week1 Reg time S Prod.week1 o Over time u Prod.week2 Reg time r Prod.week2 c Over time e Prod.week3 Reg time Prod.week3 Over time

Destination
400 500 550 650 400 500 0 0 0 0 0 0

1 2 3 4 5 6

300 400 M M M M

350 450 500 600 M M

2 2 3 2 1 2 5

Demand

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