A company that sells sportwear in the US is experiencing significant delays in the delivery of merchandise from overseas. The company has been forced to order seasonal clothing up to one year in advance. How can the company improve its inventory turnover ratio?

While reducing prices may temporarily increase sales volume, it does not directly address the underlying issue of inventory turnover. Lower prices could lead to reduced profit margins, and if inventory is still delayed, the company may continue to face challenges in meeting consumer demand efficiently.

Negotiating better credit terms might improve cash flow and allow the company to manage expenses more effectively, but it does not solve the problem of slow inventory turnover. If products are still delayed, favorable credit terms will not enhance the speed at which inventory is sold or replenished, thus leaving the turnover ratio unchanged.

Taking on debt to cover product costs may provide immediate liquidity but does not resolve inventory management issues. Increased debt could lead to higher financial risk without addressing the core problem of delayed inventory delivery. Consequently, this option could strain the company's financial health without improving turnover rates.