How to properly design XML file with multiple tables inside?

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Hello! :)

For my application I will have one XML file which will contain multiple tables inside. It will be for application support. Inside will be different data and settings. I didn't need XML for something similar yet and I'm not sure how to format/design this XML structure.
I created two sample XML files below. Which approach/design should I use and why this and not the other one? Which is common approach if you would like to have multiple tables in one XML file?

Design 1:

<pre lang="xml"><?xml version="1.0" encoding="utf-8" ?>
<root>

  <Customers>
    <Customer>
      <Id>1</Id>
      <FirstName>Joe</FirstName>
      <Surname>Doe</Surname>
    </Customer>
    <Customer>
      <Id>2</Id>
      <FirstName>Mary</FirstName>
      <Surname>Brown</Surname>
    </Customer>
    <Customer>
      <Id>3</Id>
      <FirstName>Paul</FirstName>
      <Surname>Smith</Surname>
    </Customer>
  </Customers>

  <Categories>
    <Category>
      <Id>1</Id>
      <Name>Beverages</Name>
    </Category>
    <Category>
      <Id>2</Id>
      <Name>Grains</Name>
    </Category>
  </Categories>

  <Products>
    <Product>
      <Id>1</Id>
      <Name>Tea</Name>
    </Product>
    <Product>
      <Id>2</Id>
      <Name>Cereals</Name>
    </Product>
  </Products>
</root>

Design 2:

<pre lang="xml"><?xml version="1.0" encoding="utf-8" ?>
<root>
    <Customer>
      <Id>1</Id>
      <FirstName>Joe</FirstName>
      <Surname>Doe</Surname>
    </Customer>
    <Customer>
      <Id>2</Id>
      <FirstName>Mary</FirstName>
      <Surname>Brown</Surname>
    </Customer>
    <Customer>
      <Id>3</Id>
      <FirstName>Paul</FirstName>
      <Surname>Smith</Surname>
    </Customer>

    <Category>
      <Id>1</Id>
      <Name>Beverages</Name>
    </Category>
    <Category>
      <Id>2</Id>
      <Name>Grains</Name>
    </Category>

    <Product>
      <Id>1</Id>
      <Name>Tea</Name>
    </Product>
    <Product>
      <Id>2</Id>
      <Name>Cereals</Name>
    </Product>

</root>

Both actually contain the same data, but it present differently. I think "Design 1" is more expandable for the future if I add more information to specific table.

Thanks, for all advices.