Product categories label what a product is made as — its construction. The Product Categories page is where that master list is set up.

The Product Categories page is the master list of construction categories a product can be given, for example jersey, knit, woven. Click Add category, type the name, and give it an icon. A product can carry one category from this list and you can set up which categories are offered on a product, and which one is the default, per hierarchy node (in admin page Hierarchy Nodes).