A mixing service can be used to mix one's funds with others' or with MIXER's reserve, with the intention of confusing the trail back to the funds' original source. Mixing helps protect privacy, but can also be used for money laundering - mixing illegally obtained funds. After laundering, the funds appear legitimate.
Bitcoin-Mixing.com is used to avoid compromising of privacy and security. Mixing services provide to periodically exchange your bitcoins for different ones which cannot be associated with the original owner.