Final answer:
Walmart's transactions with suppliers are made highly efficient through an internal Internet-based system, which allows for real-time communication, inventory management, and streamlined operations. This contributes to low operation costs and the ability to offer competitive pricing.
Step-by-step explanation:
What makes Walmart’s transactions with suppliers highly efficient and lowers its cost of operations? The most fitting answer would be their internal Internet-based system with suppliers. This type of system allows for an integrated supply chain, where Walmart can communicate and coordinate with its suppliers in real-time. This efficient communication means inventory can be managed more precisely, reducing excess stock and minimizing storage costs. Quick turnaround on orders and an ability to adapt to changing market conditions are part of what gives Walmart a competitive edge. These streamlined operations allow Walmart to maintain low costs and pass savings on to the consumer, which is a central component of their business model.
By keeping their operations lean and effectively managing their supply chain, Walmart can offer low prices to consumers, adhere to their cost structure, and maintain their massive economies of scale. This strategy has had significant impacts on local economies and competition, as seen in discussions about the Walmartization of the retail sector. However, it's the efficiency of Walmart's supplier relationships and operational management that has played a crucial role in their ability to offer low prices.