Your catalog describes what you sell. Your inventory records what you actually have and the condition of each item. The catalog points to stock by defining which items must be available when a listing is purchased.
The depth of your listings is limited by how granular your inventory is. With individualized inventory you can create highly specific product pages or keep things broad based on the needs of each sales channel.
You can maintain aggregated SKUs and count unique items by ID without tracking every detail. When you need to showcase a single item you can spin up an item level listing that points to that ID.
Build your catalog on top of individualized inventory to balance speed, control, and conversion. Go broad for reach, go granular for intent, and keep stock accurate across every channel.