A reseller web hosting package allows you to host several web sites on one server. With it you can divide the diskspace and bandwidth across different web sites on the same machine. Each reseller hosting account comes with a master administration panel or a master control panel that allows you to create your own hosting packages. You can then resell hosting to others.
You don't need a reseller hosting package if you want to host only one site. You also don't need one if you plan to put several of your own web sites. A reseller package is required only when you need to host multiple web sites of different people because in this way you would be able to give each web site its own control panel.