How to best handle products / inventory for a medium sized retail business with possibly thousands of different small items when they don't recur as much (only sell what is on trend) and are small in value?
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It depends on what kind of business you have. If you sell on the internett, your customer needs to see pictures and description of every item. And you need to keep track of all details in your inventory.
If you on the other hand bring the stuff to an open market place and sell cash, you might not need to use the inventory app at all, since you do not need to keep track of details of products and inventory.
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Create a combo product
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