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 Learning Outcomes:
At the end of the lesson, the students should be able to:
1. construct a transportation problem model;
2. solve the balanced transportation problem;
3. obtain the initial feasible solution by using
Northwest Corner Rule, Minimum Entry Method and
Vogel’s Approximation Method;
4. evaluate the optimal solution using Stepping Stone
Method.
 Overview:
What is transportation problems?
Transportation problems are linear programming
problems which involve transporting or shipping goods
or products from several sources (plants) to several
destinations (warehouses) at minimum costs. It was
first presented by F. L. Hitchcock in 1941 and later
expanded by T. C. Koopmans.
Transportation Problems
 Balanced Transportation
Problems
A balanced transportation problem has equal number of
units of demand and supply. That is,
 Steps in solving balanced
transportation problem:
1.  Construct a transportation model of the problem.
The transportation model is a table showing the
sources (written in rows) while the destinations
(written in columns) of the items to be transported.
The last row of the table shows the demand and the
last column shows the supply. The cost of
transportation of each source to each receiving outlet
is written on the upper right corner of each cell
formed.
 Steps in solving balanced
transportation problem:
2. Obtain the initial feasible solution by using
a. Northwest Corner Rule
(i) Start allocating the units on the upper – left –
hand cell (northwest corner) of the tableau.
Allocate the lower of the supply and demand
corresponding to that cell.
(ii) From the northwest corner, move to the next
row if the supply available in that row is not yet
exhausted or move to the next column if the
demand available in that column is not yet met.
(iii) The allocation of units will end at the lower –
right – hand cell (south – east corner) of the
tableau.
b. Minimum Entry Method
(i) Choose the cell with the lowest available cost
Cij and allocate the shipment so as to exhaust
either the production of plant Pi or meet the
requirements of warehouse Wj or both.
(ii) Delete the ith row or the jth column, depending
on whether the allocation exhausts the supply at
source Pi or meets the requirement of warehouse
Wj . If both of these occur simultaneously
(degenerate case), delete the ith row unless it is the
only row remaining in which case delete the jth
column.
(iii) Adjust the supply remaining at plant P i or the
unfilled demand of warehouse WJ .
(iv) If there remains two or more rows or columns
not yet deleted, go to step (i); otherwise, the initial
basic feasible solution is obtained.
c. Vogel’s Approximation
Method
(i) Compute the difference between the costs of
two cheapest routes for each origin and each
destination. Each individual difference is
interpreted as a penalty for not choosing the
cheapest route and is marked opposite each row
and column.

(ii) Identify the row or column with the largest

difference. Allocate the shipment to the lowest
cost cell in that row or column so as to exhaust
either the supply at a particular source or meet
the demand at a warehouse.
(iii) Drop the ith row or the jth column, depending on
whether the allocation exhausts the supply at plant P i
or meet the requirements of warehouse W j . If both of
these occur simultaneously (degenerate case), delete
the ith row unless it is the only row remaining, in
which case drop the jth column.
iv) Adjust the supply remaining at source Pi or the
demand of the warehouse not yet met.
(v) Go to step (i) and repeat the procedure until an
initial assignment using m + n - 1 cells is obtained.
 Steps in solving balanced
transportation problem:
3. Evaluate the optimal solution using the
Stepping Stone Method.
Stepping Stone Method is a process to evaluate each
vacant cell by tracing its path.
The term “stepping stone” was used because the
process of doing the stepping – stone is like crossing
a stream by moving form one stone to another stone
(occupied cells).
(i)  Used the table done by the northwest corner
rule.
 (ii) Determine the vacant cells. For each vacant
cell, trace a path (horizontal and vertical directions)
that will pass through the occupied cells and will
end in the same vacant cell being evaluated.
(iii) Give alternating signs (+/–) starting with a
positive sign from the cost of the vacant cell being
evaluated to the next costs in the path.
(iv) Determine the improvement (a decrease in
cost) for each vacant cell by adding the costs
determined in step (iii). The most negative cell
evaluation implies a most decrease in cost.
(v) Choose the best cell improvement. The most
negative cell evaluation gives the best cell
improvement; then shift as many units as possible
to that vacant cell.
(vi) Repeat steps (ii) to (v) until an optimal solution
is obtained. An optimal solution is obtained if each
cell evaluation has positive or zero result.
 Example:
Balanced Transportation
Problem
I. Solve the following transportation problems:
1. Costales manufacturing company operates plants P1,
P2 and P3 in different regions. The weekly production of
these plants is as follows:
The total supply of the company is absorbed by
warehouse W1, W2 and W3. Their weekly
requirement is as follows:
The transportation cost from each plant to each
warehouse is given below.

A. Determine the minimum cost transportation schedule

using an initial basic feasible solution obtained by each
of the following methods:
a. Northwest Corner Rule
 A N S W E R:
a. Northwest Corner Rule

9 11 7
100 10 110
8 5 10
60 30 90
14 13 55 9 55

100 70 85 255

100(9) + 10(11) + 60(5) + 30(10) + 55(9)

2,105.00
b. Minimum Entry Method
 A N S W E R:
b. Minimum Entry Method

9 11 7
25 85 110
8 5 10
20 70 90

55 14 13 9 55

100 70 85 255

25(9) + 85(7) + 20(8) + 70(5) + 55(14)

2,100.00
c. Vogel’s Approximation Method
 A N S W E R:
c. Vogel’s Approximation Method

9 11 7
80 30 110 2
8 5 10
20 70 90 2
14 13 9
55 55 5

100 70 85 255

1 6 2

80(9) + 20(8) + 30(7) + 70(5) + 55(9)

1,935.00
B. Find the optimal solution using stepping stone
method.
 A N S W E R:
B. Find the optimal solution using stepping stone
method.

9 11 7
100 10 110

8 5 10
60 30 90

14 13 9
55 55

100 70 85 255

100(9) + 10(11) + 60(5) + 30(10) + 55(9)

2,105.00

P1 – W3 = 7 – 11 + 5 – 10 = -9 P3 – W1 = 14–9 + 10 –5 +11 – 9 = 12
P2 – W1 = 8 – 9 + 11 – 5 = 5 P3 – W2 = 13 – 9 + 10 – 5 = 9
 A N S W E R:

9 11 7
100 10 110

8 5 10
70 20 90

14 13 9 55
55

100 70 85 255

100(9) + 70(5) + 10(7) + 20(10) + 55(9)

2,015.00
P1 – W2= 11 – 7 + 10 – 5 = 9 P3 – W1= 14 – 9 + 7 – 9 = 3
P2 – W1 = 8 – 9 + 7 – 10 = - 4 P3 – W2= 13 – 9 + 10 – 5 = 9
 A N S W E R:

9 11 7
80 30 110

8 5 10
20 70 90

14 13 9
55 55

100 70

80(9) + 20(8) + 70(5) + 30(7) + 55(9)

1,935.00

P1 – W2 = 11 – 5 + 8 – 9 = 5 P3– W1= 14 – 9 +7 – 9 = 3
P2– W3= 10 – 7 + 9 – 8 = 4 P3– W2= 13 – 5 + 8 – 9 + 7 – 9 = 5
 A N S W E R:

P1 W1 80 9 720

P1 W3 30 7 210

P2 W1 20 8 160

P2 W2 70 5 350

P3 W3 55 9 495

1,935.00
 Exercise / Activity No. 2:
Balanced Transportation
Problem
I. Solve the following transportation problems:
1. Enriquez manufacturing company must ship its products from three plants to
three warehouses. The weekly production of the plants is 120, 75 and 55. The
weekly requirements of the warehouses are 100, 90 and 60. The shipping cost
from each plant to the warehouse is given below:

Warehouses

Plants From \ To W1 W2 W3

P1 P9 P13 P7

P2 4 6 8

P3 6 5 10
Find the following:
a. The minimum cost transportation schedule using an
initial basic feasible solution obtained by each of the
following methods:
(i) Northwest Corner Rule
(ii) Minimum Entry Method
c. Vogel’s Approximation Method
b. The optimal solution using stepping stone method.