It would help to stamp out the awful trade in young girls and women (and quite possibly boys/young men) for the sex industry. It would put the whole service on a legal footing. It would protect prostitutes and their clients both in terms of their health (the premises and workers would be screened to help restrict the spread of STDs) and their physical safety (far less danger of punters being mugged and considerably less danger of the prostitutes being beaten up or worse.
It would also help protect communities from the impact of kerb-crawlers looking for sex in known "red-light" areas.