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Transportation Assignment and Transshipment Problems

The document discusses transportation and transshipment problems in supply chain modeling. It describes transportation problems as involving distributing goods from supply locations to demand locations at minimum cost. Transshipment problems extend transportation problems by including intermediate transshipment nodes like warehouses. Network representations are used to model these problems, with nodes and arcs showing flow. An example transportation problem and its linear programming formulation are provided.

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Raniella Sarmiento
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137 views

Transportation Assignment and Transshipment Problems

The document discusses transportation and transshipment problems in supply chain modeling. It describes transportation problems as involving distributing goods from supply locations to demand locations at minimum cost. Transshipment problems extend transportation problems by including intermediate transshipment nodes like warehouses. Network representations are used to model these problems, with nodes and arcs showing flow. An example transportation problem and its linear programming formulation are provided.

Uploaded by

Raniella Sarmiento
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Transportation and

Transshipment
Problems

Real, MNC.
Supply Chain Models
• A supply chain describes the set of all
interconnected resources involved in
producing and distributing a product.
• The set of all interconnected resources
involved in producing and distributing a
product.
Transportation Problem
• The transportation problem arises
frequently in planning for the distribution of
goods and services from several supply
locations to several demand locations.
• The usual objective in a transportation
problem is to minimize the cost of shipping
goods from the origins to the destinations.
Network
• A graphical representation of a problem
consisting of numbered circles (nodes)
interconnected by a series of lines (arcs);
arrowheads on the arcs show the direction
of flow. Transportation, assignment, and
transshipment problems are network flow
problems.
Example: Foster Generators operates plants in
Cleveland, Ohio; Bedford, Indiana; and York,
Pennsylvania. Production capacities over the next
three-month planning period for one particular type
of generator are as follows:
The firm distributes its generators through
four regional distribution centers located in
Boston, Chicago, St. Louis, and Lexington;
the three-month forecast of demand for the
distribution centers is as follows:
Transportation Cost per Unit
To determine the routes to be used and the
quantity to be shipped via each route that will
provide the minimum total transportation cost.
Cost Expression
Constraints
Linear programming formulation of the
Foster Generators transportation problem
Problem Variations

• Variations of the basic transportation model


may involve one or more of the following
situations:
• 1. Total supply not equal to total demand
• 2. Maximization objective function
• 3. Route capacities or route minimums
• 4. Unacceptable routes
Transshipment Problem
• The transshipment problem is an extension
of the transportation problem in which inter-
mediate nodes, referred to as transshipment
nodes, are added to account for locations
such as warehouses
• From Denver to Kansas and Louisville

• From Atlanta to Kansas and Louisville


• Node #3

• Node #4

Node 5
Node 6
Node 7
Node 8
• In the general linear programming formula-
tion of the transshipment problem, the con-
straints for the destination nodes are often
written as

• The advantage of writing the constraints


this way is that the left-hand side of each
constraint then represents the flow out of
the node minus the flow in.

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