WIP is a manufacturing acronym for Work In Process.
It's anything that's begun the journey from something you buy into something you will sell. It's neither good nor bad.
Bad things about WIP: It's considered part of your inventory, and should therefore be minimized when possible. Having WIP means there is product to spoil, get contaminated, or to get stuck in your process when the finished good stops selling.
Good things about WIP: having some WIP is a lubricant for getting finished product out the door. As part of a pull production system, when a customer orders product, you can move all of the WIP forward in your process in a short amount of time rather than creating the finished product from scratch when the order is received.
Finding the right amount of WIP for your studio depends on many factors like how many production hours you have and the total active and passive time needed to create your products.