LS Central uses a 3-tier item hierarchy. Division is the highest level followed by Item Category, under Item Category are Product Groups.
Note that there is a one-to-one relationship between divisions and item categories as well as between item categories and product groups. This means that a single item category can't exist in multiple divisions and a single product group can't exist in multiple item categories.
Due to the linking between the different levels in the item hierarchy, it is recommended (and configured by default) to set up the hierarchy directly in LS Central using the linked page.
For more information, see Item Division.