Item Category generally used as a key factor to decide the behaviour of the item like related to price or text item or free item etc. in a sales order.
Step1. Navigate along the SPRO IMG path or launch Tcode- VOV7.
Step2. Double click on the standard item type TAN.
Step3. Here we can find the below details, like if a material is assigned to this item category then it is related to pricing or not, etc. Go back.
Step4. To create a new item category, Select the item category and click on the Copy button.
Step5. Here change the attributes for the new item category as per needed. Save it and go back.
Step6. So a new item category is added to the list.
SAPCODES 