Final answer:
An inventory turnover of 3.7 suggests that the retailer sells its entire stock of inventory about 3.7 times a year, implying the rate at which the inventory is sold and replaced during the period.
Step-by-step explanation:
An inventory turnover of 3.7 indicates that a retailer sells its inventory approximately 3.7 times during a certain period, typically a year. This means the company would take roughly the total days in the period divided by 3.7 to sell out its entire stock of inventory. A higher inventory turnover rate can suggest strong sales or effective inventory management, whereas a lower rate may indicate excess inventory or weaker sales.