ORGANIZATION OF COAL DISTRIBUTION IN PGG

Abstract

Motivation: The aim of this article is to show how the distribution of hard coal (and energy fuels) is organized in one of the largest coal companies in Europe. The analyzed company merged (1.04.2017) with Katowicki Holding Węglowy to form a new business entity. These actions have changed the organizational structure of the companies.

Problem statement: During the planning of the hard coal distribution the specific nature of the coal industry must be taken into account. First of all, an analysis of the hard coal sales time series reveals a regularity of this phenomenon. The increased consumption of this fuel is clearly marked in the winter. As a result, mining companies are not able to eliminate sales and production seasonality due to natural causes. Therefore, in order to adapt to variable market conditions mining companies must manage production and distribution in order to survive the period of reduced demand, but also to meet the increased demand when needed.

Approach and results: To examine the company's newly established structure a document analysis method was used. This study allowed to clarify the hard coal market in terms of marketing and to divide it on the basis of the coal consumption level. Two groups of customers, i.e. large customers and so-called small customers have been identified. The distribution channels of hard coal have been analyzed, as well as the methods of coal carriage to individual customers. The analysis of documents shows that small customers are the primary recipients of broken coal and small quantities of pea and rice coal. In the case of the coal distribution to small customers the most common solution is merchant participation. The role of the merchant is to reach the largest number of customers and to reduce seasonal fluctuations. The delivery of coal is usually carried out for those buyers by road transport.

Conclusions: The conducted research allowed to clarify the hard coal market in terms of marketing and to divide it based on the level of hard coal consumption. Analysis of coal distribution was carried out in order to enable future modifications of the company's distribution process using geomarketing tools such as for example geocoding, Voronoi polygons, and geoprocessing.