The categories would be used to order the tools on the panels/ribbon. We discussed two alternative designs. Here are wireframes showing rough positioning of items.
Alternative 1 - Reorganized side panel layout. Click on a tool and the options panel contextually changes to the options for the tool.
Alternative 2 - Ribbon Layout. The tools are organised on the ribbon in categories, and options for the the selected tool will appear in the options panel to the left.
NOTE: I am using the free Pencil software to do the mockups: https://pencil.evolus.vn/