Multi-store as the name suggests is sellers creating or having multiple stores online to sell their products. The majority of reasons why sellers create multiple stores is to target different target markets or to sell different products under different pricing models and brands.
These stores can have their own unique domains or they can also be managed under sub-domains. Apart from that, the majority of the time these stores are usually integrated on one single platform so that the administrators of these stores can manage them on a one-single platform and can get a holistic view of things with centralized management and integrated data flows.