Finished goods are goods that have completed the manufacturing process but have not yet been sold or distributed to the end user.
Manufacturing has three classes of inventory:
A good purchased as a "raw material" goes into the manufacture of a product. A good only partially completed during the manufacturing process is called "work in process". When the good is completed as to manufacturing but not yet sold or distributed to the end-user, it is called a "finished good".
Finished goods is a relative term. In a Supply chain management flow, the finished goods of a supplier can constitute the raw material of a buyer.