Transportation Problem 1. Northwest-Corner Rule: Start in the upper left-hand cell (or northwest corner) of the table and allocate units to shipping routes as follows: 1. Exhaust the supply (factory capacity) of each row before moving down to the next row 2. Exhaust the (warehouse) requirements of each column before moving to the next column 3. Check to ensure that all supplies and demands are met Transportation Problem 2. Intuitive Lowest-Cost Method: 1.Identify the cell with the lowest cost 2. Allocate as many units as possible to that cell without exceeding supply or demand; then cross out the row or column (or both) that is exhausted by this assignment 3. Find the cell with the lowest cost from the remaining cells 4. Repeat steps 2 and 3 until all units have been allocated Transportation Problem Walmart wants to decide about amount of transportation from its distribution centres to its stores. They want to find a feasible solution that assures the demand in each store is satisfied. The transportation costs between stores and distribution centres, the demand of stores and the capacity of distribution centres are as follows: From To Hamilton Toronto Waterloo London Capacity Kitchener $4 $6 $2 $5 400 Guelph $7 $5 $4 $6 200 Brampton $6 $2 $7 S4 500 Demand 300 500 100 200