Beginning Inventory is the inventory value you carry from the previous period. Changes to your beginning inventory from period to period indicate a shift in the business. For example, a decrease could be due to an increase in sales. However, it may also be a supply chain issue. An increase could be due to a drop in sales, but it could also be a result of larger stock orders ahead of a busy period. Beginning inventory is key to managing your business efficiently, and understanding both operational and sales trends.