Inventory is the stock waiting to be sold, sitting on the balance sheet as a short-term asset. One crucial detail: it is valued at cost, what the company paid to buy or produce it, not at the price on the shelf. The coffee shop's beans appear at what the supplier charged, and the profit only exists once a customer buys.
The rule is asymmetric, too: if stock loses value, goes stale, obsolete, or out of fashion, it must be written down below cost, but it can never be marked up toward selling price.
Industries differ wildly in how much they hold: software has almost none, retail and manufacturing carry mountains. The trend beats the level: inventory rising while revenue stays flat means products are being made faster than they sell, and price cuts or write-downs usually follow.