Spacer is the distance between your ball bearings inside the wheel. Like so much else in skateboarding, the standard measurement of 1cm is usually used. Note that the tolerance between different wheel manufacturers can differ slightly by hundredths (which means that if you use the same ball bearings and spacer on one wheel, you may be able to tighten your nut to the maximum without the wheel locking up, while on another brand of wheel you may not be able to tighten the nut fully without it affecting the wheel's roll).
It works by making sure your bearings don't get squeezed together weirdly when you tighten your axle nut. You can still ride without it but if you want to make sure the bearing races don't get warped or slow your wheel down when you turn it is recommended to use this. A small cost to improve. Some bearings already have this built into them, this type of bearing is usually called built-in.
We recommend that you always use spacers in your bearings because it actually improves performance. In other words, it can be quite a waste to buy expensive bearings if you neglect to use this little washer because then you won't be able to enjoy the best performance from them either. But you can also choose to use bearings that have it built in as mentioned.
