Repair benches offer a cost-effective way to repair once-broken items back to a usable state. Each repair costs half of the original cost of a new version of the item, and does not use components. Every time an item is repaired, it loses some of it's maximum durability. This is represented with a red portion on the durability bar of the item.
The Repair Bench can currently change the skin of any item you have (granted it HAS varying skins) to any skin that you own in your steam inventory.