Well, if you want to allow for a larger entry, or limit the entry size perhaps.
For example, you may have first_name as a VARCHAR 20, but perhaps street_address as a VARCHAR 50 since 20 may not be enough space. At the same time, you may want to control how large that value can get.
In other words, you have set a ceiling of how large a particular value can be, in theory to prevent the table (and potentially the index/index entries) from getting too large.
You could just use CHAR which is a fixed width as well, but unlike VARCHAR which can be smaller, CHAR pads the values (although this makes for quicker SQL access.
