Understanding Category Structure

Category structure is probably one of the hardest things for store owners to grasp, however, it is the category organization that will need to be understood to in order to keep inventory management easy to understand.

Imagine walking into a Big Box superstore like Walmart. Your goal is to buy a hammer. Based on basic knowledge, and Walmarts ability to categorize their items by what they are, you should be able to find your item with minimal to no assistance. The first thing you are going to do is head for the hardware department because generally, we know tools are usually kept under hardware. Next, we are going to look for the Tools section of the hardware department. This is a section (Tools) within a section (Hardware). Now we are in the Tools section, we are going to look for the hand tools. Yes another section (Hand Tools), within a section (Tools), within a section (Hardware). This is a great example of categorizing your items, and how optimally you would want to enter them into your inventory system.

The first thing to understand is that Liberty will not allow you to enter items into the inventory module without first choosing a category.

Liberty supports a Three Level category structure or less. What does that mean? If we go back and read about Category Organization, we were looking for a hammer. In that scenario, we had to go to the hardware section, then the tools section, then the handheld tools. In The inventory module that would look like this. Handheld Tools – Tools – Hardware.

But what if your store is a Hardware Store. Then you would probably use a two-level category structure. If this were the case then you could use a two-level category structure that would look like this. Handheld Tools – Tools.

But what if I specialize in tools. Then you would use a single level category structure and the category you would probably use would look like this. Handheld Tools.

Simple, organization. This not only keeps our inventory module easy to manage, but it also helps us how in the store items should be organized. it makes end of the year inventory counts much easier to do. It makes training new employees easier. It is also easier for your customers to find items based on what they are at ease. Also if a customer sees your store is organized and well kept, this will encourage them to come back for more in the future.

Also having a categorized inventory helps running reports. makes ordering much easier. Reduces the chance of over ordering the right items. And if it ever comes down to having to ever sell the business, it will be easier to monetize the store based on how it is categorized.

The first time you are setting up categories, it is recommended to draw out your category structure on paper first.

Types, brands, size, color, model, material Etc…. These are all known as Attributes and they are covered in our Attributes Blog! Attributes help to further define the item and its individuality.

Categorizing items is important to manage inventory, save money, and make it easy to track inventory.