Microsoft® Office Excel® 2007: Data Analysis and Business Modeling, Second Edition

Chapter 29. Using Solver to Solve Transportation or Distribution Problems

• How can a drug company determine at which location they should produce drugs, and from which they should ship drugs to customers?

Many companies manufacture products at different locations (often called supply points), and ship their products to customers (often called demand points). A natural question then is, what is the least expensive way to produce and ship products to customers and still meet demand? This type of problem is called a transportation problem. A transportation problem can be set up as a linear Solver model with the following specifications:

• Target cell. Minimize total production and shipping cost.

• Changing cells. The amount produced at each supply point ...