item category means

Hello Experts.

Please explain me what exactly mean by item category.why it is needed and what are the types of it

and what would be the impact of it. Please explain me in a layman language with example.

I seen this statement in sd book by glenn williams

The sales item category is one of the most important fields in the SAP sales order. It controls

the sales document flow and also impacts the schedule line category. The item category

of the sales order affects the delivery and finally impacts the billing process as well.