When we start to develop a document, we specify the document class, choose meaningful packages and options, and create a frame for the contents. To repeat these steps for each document would be too laborious.
Declaration of a suitable document class together with a set of meaningful options
Routinely-used packages and packages which are most eligible for our document type
A predefined layout for header, footer, and body of the text
Self-made macros to ease our work
A framework of sectioning commands, where we fill in the headings and the body text
Or a framework containing
\inputcommands, for which we create the body text chunks later on.
While we improve our LaTeX knowledge, such templates might grow and become better and more sophisticated. Many users publish their elaborate templates on the Internet. Many universities, institutes, journals...