What happens when merchandise turnover is high?

When merchandise turnover is high, it generally indicates that products are selling quickly. This rapid sales movement can lead to increased revenue, as more items are sold in a given period. Additionally, with a high turnover rate, there is less need for markdowns, which are often used to reduce excess inventory. When items sell at full price and quickly move out of inventory, the store's financial performance improves due to minimized discounting. This creates a positive cycle where increased sales and reduced markdowns enhance overall profitability.

Understanding the dynamics of merchandise turnover is crucial because it influences inventory strategies, sales forecasting, and marketing efforts. In contrast, the other options highlight consequences that do not typically accompany high merchandise turnover, such as complications in inventory management or adverse effects on employee morale, which are more relevant to situations where inventory moves slowly.