Turning it on
Stock tracking is per product. Edit the product, switch on Track stock, and enter how many you have right now.
What happens then
Every sale subtracts from the count automatically. When the count drops to your low stock number, the product is flagged on the Catalog page and on your dashboard.
Restocking
Edit the product and set the new count, or use the + Add stock button to add what came in on the truck.
You do not have to use it
Plenty of shops leave stock tracking off and just use the register. That's fine.