Depends on the game, but I usually sort my player inventories by item purpose. Items that never leave the inventory (quest items, alternative gear, etc) at the top, then potions/food, then ammunition, then whatever random loot I’m picking up.
As far as Valheim goes, I actually really enjoy building highly organized dedicated storage rooms with for all my loot. My brain makes the good chemicals when I go into the storage closet and see my neatly labeled chests (now why won’t it do that in real life?). It’s worth noting that the chest size issue gets much, much better further on in the game. You go from 10 items per chest to 24 when you get access to iron, and 32 with black metal.