You get the Item Book after Rita joins by searching the loft in her hut. As mentioned in the achievement description, some items can only be acquired through synthesis. Don't sell your old weapons! You will be using them to form new weapons later on. For now, just be sure to get every treasure chest, cooking recipe, etc. and do every side-quest possible. Be sure to spend 10 in the Grade Shop to carry your book over to any future playthrough.
See this thread for all the items and explanations on how to get them.