Which of the following best describes 'fill rate'?

The correct answer is the percentage of customer demand fulfilled, as fill rate specifically measures how much of the customer demand for products is met with available inventory during a specific period. A high fill rate indicates that a retailer can effectively meet customer demand without stockouts, which is crucial for customer satisfaction and maintaining competitive advantage.

In contrast, the average time taken to receive stock from suppliers focuses more on the logistical efficiency of the supply chain rather than the fulfillment of customer demand. The number of returns processed per month pertains to customer returns and does not reflect the fulfillment of orders. The ratio of items sold to items in stock, while it can provide insights into inventory turnover, does not directly measure the proportion of demand that has been satisfied. Thus, filling customer demand is the most definitive aspect of the fill rate concept.