Transportation Cost Optimization

Abstract

Many manufacturing make their products in few locations and ship them to many different locations. In this paper we use Evolver, Excel Solver and Microsoft Solver Foundation in order to optimize transportation cost or to find the cheaper way to make and ship products to the customers and meet customers’ demands. “Proplast” company that manufactures doors and windows is located in three different places; in Ferizaj, Pristina and Prizren and supplies 9 shops in Kosovë, Albania, Macedonia, Montenegro and Serbia. Mathematically speaking, our goal is to find minimal transportation cost and this problem will be set up as a linear programming model with the below definition: * Minimize total production and transportation cost; * Constraints: -The amount shipped from each factory cannot exceed plant capacity, - Every shop must receive its required demand, - Transportation trucks have the limit of loading quantity and - Each shipping amount must be nonnegative. We will show Evolver, Excel Solver and Microsoft Solver Foundation results and will find the least expensive way. Also we will compare minimum and maximum cost for all software’s.

DOI: 10.5901/ajis.2015.v4n2s1p42