When you have created a category, you can create multiple layers of
sub-categories.
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Select site > Merchant Tools >
Products and Catalogs > Catalogs.
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On the Catalogs page, click a catalog ID.
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Click the name link of the category in which you want to create the sub-category.
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On the Categories page, click New in the Categories section.
Specify a name and ID for the new sub-category and click Apply.
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Specify the language, ID, name, and optional description for the new sub-category and
click Apply.
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On the New Category page, click <<Back.
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On the Category page, you can assign products to this category.