Least Cost Method (Algorithm)

Algorithm of Least Cost method is as follows:

1. Creating a table format of initial transportation.
2. Capacity and demand must be equal. If not the same (capacity> demand or capacity <demand) then it should be equated in advance by adding artificial source or destination may be false.
3. Once the table is ready, we started to recharge the empty cells starts from cells that have cost the cheapest / smallest to be met (with regard to capacity and demand). Initial charging a fully charged cell is expected to qualify (m + n -1) fails to satisfy because it can be called degeneration and this case no solution in itself.
4. Calculate the Total Cost of transport early to know whether the total cost has been minimal or not it should be carried out improvement index checking empty cells. If all the improvement index ≥ 0 then STOP.
5. If there is still improvement index is negative then do the reallocation started from cells that have the greatest negative improvement index and then calculate the total cost of transportation.
6. And so on until all the positive index value improvement.

#Source : private thesis

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