Party groups is a way of grouping together parties. You are able to link the parties, provide a name for the party group and add additional custom fields to the party group to store specific information. A typical use of Party Groups is as follows

Party Group: EMI

Parties: EMI - London , EMI - New York.

You could then have information about EMI Group such as their Global Tax Reference, Group Level Telephone Number.

Please refer to this article that details how to work with the Party Group Form 

Tip: Party Groups are optional. You don't have to define a party group for a Party to have associated contracts, people, Notes, KPIs