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In this Whiteboard Wednesday tutorial, James outlines key inventory basics. He emphasizes the importance of sourcing inventory from vendors for redistribution or production. Locations for inventory can be on-site, off-site, or through dropshipping. Identifying inventory accurately is crucial, particularly through the use of Stock Keeping Units (SKUs), which aids in knowing what items are available and their locations. While establishing this system may require initial time investment, it ultimately saves time in the long run by minimizing searching for items. Additionally, considerations for units of measure—such as pounds, metric, or ounces—are highlighted as essential in inventory management.