It allows you to combine different items to make new ones.
Ex. nails+bat+hammer = spiked bat.
Its also possible to barricade windows and doors if you have wood planks, hammers and nails.
The point of the game is to survive as long as possible, as far as i know you can't win it and will die eventually.
The game isn't free though which is the only downside considering that the game is still in alpha.