What does the turn rate indicate in inventory management?

The turn rate in inventory management signifies the frequency at which inventory is sold and replaced over a specified period. This metric is crucial for understanding how efficiently inventory is being utilized and can impact cash flow positively if managed well. A high turnover rate indicates that a business is selling through its inventory quickly, which is often a sign of strong sales and effective inventory management practices.

In contrast, other options such as the monetary value of goods sold or the total cost of inventory provide important information about finances and valuation but do not specifically reflect how often inventory is moving. The efficiency of supply chain logistics relates to the processes involved in getting products to market but does not directly measure inventory turnover. Therefore, the frequency of inventory turnover is essential for assessing overall operational efficiency and sales effectiveness, making it the correct answer to this question.