A contact is a named person at one of your customers or suppliers: the accounts clerk you chase about an invoice, the buyer who takes your calls, the engineer who signs for deliveries. Each contact hangs on exactly one customer or supplier record, and shows on that record's own page as well as in the Contacts list here.
The fields are the ones a working relationship needs: Title (from the titles list maintained in System Setup), First name and Surname, Official title — their job, in their employer's words — Telephone and Email.
Contacts have no sign-in and no permissions; they are simply the business's memory of who, kept with the company they belong to. When your own staff change, the knowledge of who to call does not walk out with them.