Treat ABCs

If your dog is food motivated, using treats as rewards can help you reach your training goals quickly and painlessly. But not all treats are created equal. Sometimes treats are a hindrance, their very presence so distracting that your dog is too concerned with figuring out what's in your pocket to pay attention to the fact that you're talking to him. Some treats are worth sitting for, but maybe not worth doing anything more complicated than that and the treat that was good enough last week might be the same old same old today. Treats must be used wisely and one way to do this is to grade them as many trainers do.

I personally was taught to grade treats as A, B and C with A being the highest value treat and C being the lowest value treat. Here's how it works.

C Treats
C treats are kibble, milk bones and other dry, non-fragrant treats. They are nothing special but, if your dog is hungry, already in the mood to work, or just enjoys working he might work for them. Very food motivated dogs will usually be happy with a C treat in situations where there aren't a lot of distractions.
In short, C treats are for everyday training in a controlled situation with a food motivated dog.

B Treats
B Treats tend to be moister and have more fragrance to them. These are every day treats for dogs who aren't as food motivated and special treats for highly food motivated dogs. Assuming your dog will work for C treats, you can move to B treats when you make things harder or add distractions. If your dog will not work for an C treat, you'll use B treats when teaching something new.

A Treats
A treats are liver, cheese, amazing things. Highly food motivated dogs are likely to lose all self control when these treats are around and should only be given them for things like "come" and "emergency come", otherwise you may have a hard time getting him to focus. For dogs who aren't as food motivated, these treats should be used in high distraction situations. (Though you should always take care when using high value treats in the presence of other animals to avoid food aggression incidents.)

Basic Rules for ALL Treats

Treats used for training should always be very small. Your dog should not be spending time chewing. He only needs a small taste to feel rewarded. As an example, if you use Zuke's Chicken-Flavored Mini Naturals Dog Treats you can cut them into quarters before using them as training treats Milk-Bone Dog Biscuits can be smashed with a hammer.

You must be careful to count your dog's training treats into his daily calories and adjust his daily food rations accordingly. Obesity is a common and dangerous health problem for dogs.