The grammatical error is where it says "she arranged the mannequins". It should say "she arranges the mannequins".
Explanation:
The sentence doesn't make sense when it says "Every Friday, she closes the store after she arranged the mannequins in the window to display the new merchandise", therefore the mistake is somewhere near the middle. So what you do after that is you reread the sentence (but this time a little slower), and see if you missed anything before. The mistake is a grammatical error. This is proven by looking at the last letter in the word "arranged", and then put the rest of the sentence that goes before and after it in. Then change the last letter of "arranged" to "s" and see how it sounds with the rest of the sentence.