It lets users merge two or more workouts into a single one. There have been times when I have been out riding, hiking or whatever and accidentally end the activity on my apple watch instead of pausing it. Starting a new workout means having your stats split across the two workouts.
The "usual" way to merge such workouts is to export all of them to individual FIT files, then use a tool like fitfiletools.com to merge the individual FIT files. You then have a merged FIT file, which is difficult to import back into Apple Health. This process also requires access to the internet, which is not always guaranteed when out in remote areas.
MergeFit makes this process easy by merging workouts right on device and without the need to deal with FIT files at all. It reads data directly from Apple Health and writes the merged data back to Apple Health.
The app reached a small milestone a few days ago - crossing 1000$ in total sales.