One of the beautiful things about SharePoint is its ability to provide endless ways to organize your content. Most people are familiar with folders and still like to use them. However, columns are definitely a more effective way to organize information because you have additional sorting and filtering options. That being said, SharePoint gives you the ability to do both. The benefit of doing this is that you can leverage the organization functions of sorting and filtering in one view, and then create another view that displays the actual folders.
To be explicit – here’s how this works. First you create a document library. Once your library is created, create the columns that you want. Once this is done – you can go and create the folders that you want. At this point you have folders and columns. This is useful, but there are a few things to know. For starters, by default – SharePoint will display folders and columns together. But what if you want to display all of the files inside of your folders ? This can be done with a view.

folder options in views
Create a standard view.
Under the folders section – select Show all items without folders.
This will display your list with all of your folders collapsed.
By doing this you have made it effectively possible to display the entire contents of a document library that is also organized by folders. This gives you two methods of organizing content and gives users the option to choose the method of navigation that works best for them.