Evolving items are sold in Generations, which means each Generation (Gen.) sold will evolve one stage later than the very first Generation. The direct answer as to why there are generations is unknown, some claim it is to keep the value of the 1st Gen. from becoming too low. An exception is the Rapid EI's, which evolve quickly until they are complete, upon completion the 2nd Gen. is as fully evolved as the 1st Gen.
For an example Fausto's Bottle is used, when the item is featured in an EI Report the first generation of Fauto's Bottle would be taken out of the Cash Shop and replaced with the second generation (2nd Gen.)
This continues for however long the item remains in the Cash Shop and how many Evolving Stages/Phases it takes for the first Gen to complete. After the first Gen is complete, the other Generations will continue to evolve until they too are complete.