Housetraining. Crate training is absolutely indispensable for the purposes of housetraining the puppy. Unless you are able to keep your eyes on your puppy 24 hours a day seven days a week, you will not accomplish adequate housetraining.
The crate gives puppy a safe and comfortable place to rest and sleep while it is developing its capacity for urine retention. Most puppies and dogs will not soil their sleeping quarters. With a regular schedule of outside potty breaks and copious praise, the pup quickly learns to relieve itself out of doors.
On the other hand, the pup allowed 100% freedom to wander about the house unsupervised will quickly develop the habit of urinating or defecating at will. Once this habit is formed, it becomes increasingly difficult to modify the behavior. By using a crate for housetraining, the owner can go about his or her daily activities between puppy's regularly scheduled potty breaks without having to worry about where puppy is or what puppy is piddling (or chewing) on.
Separation Anxiety. When introduced early, positively, and incrementally, crate training will provide your pup with stress- and anxiety-free comfort and security during your absences. Consider that the dam doesn't leave her pups sitting vulnerably in the middle of an open field, left to their own devices, when she must leave to attend to her business; she makes sure that the pups are safely harboured in the confines of the den. Puppies are not equipped physically, intellectually, or emotionally to handle being left all alone and vulnerable in an unrestricted home or yard, either.
It's darn scary for the average pup, and there can be profound repercussions of increasing fear, anxiety, and destructive and potentially self-injurious behaviors that you may have a most difficult time trying to resolve later.
Day to day life. There are few people indeed who have the luxury of being able to directly supervise their puppy or dog 24 hours a day. We all must get some sleep, after all. The crate is a place of familiar comfort and security for the puppy or dog during times when your attention is needed elsewhere, or while you are at work or attending to your other obligations, or while you are asleep at night.
A puppy can comfortably sleep 8 hours overnight in the crate once it has obtained nocturnal bladder control; prior to that time, you can anticipate one scheduled nocturnal potty break and return to the crate after a job well done. The crate is always -- always -- preferable to tethering your puppy or dog to a restricted area in the house or yard, or allowing your puppy or dog to freely roam unsupervised in your backyard for hours on end.
And the crate is always -- always -- preferable to allowing your puppy or dog to continually soil in the house, or damage your personal possessions, or get itself into all manner of potentially life-threatening situations when allowed unrestricted freedom in the absence of your direct supervision, until and unless your dog has demonstrated with maturity and experience its ability to remain uneventfully in the house without direct supervision.