COST OPTIMIZATION FOR TRANSPORTATION USING LINEAR PROGRAMMING

Abstract

Transportation plays a vital role in every manufacturing industry as it is one of the major 
activities that binds the whole supply chain and accounts for customer satisfaction with the 
right delivery time. Hence, bringing in an optimized transport routing on the grounds of time 
taken and cost of transportation is very important. In this paper, a cost optimization model for 
transportation of goods of a flavors and fragrance company is presented. The problem was a 
linear programming problem and was solved using an EXCEL solver. A savings of Rs. 
765,000 per annum was estimated comparing the cost of transportation in the new model to 
that of the previous model.