What is Merchandise Category in Retail? Explained

A Merchandise Category in retail is a broad classification of products that share common characteristics or serve similar purposes. It is a high-level grouping that helps retailers organize and manage their product assortment. Categories are often the first level in a merchandise hierarchy and can include diverse types of products. For example, in a clothing retailer, merchandise categories could include "Men's Apparel," "Women's Apparel," "Footwear," and "Accessories." Managing products within well-defined categories enables retailers to streamline inventory management, analyze sales performance, and tailor marketing strategies to specific product groups within their overall assortment.