The seeding option determines how players are paired in the first round of your tournament. There are three possible options:

Random (default)
Players will be randomly seeded. It is equivalent to having no seeding.
Players will be seeded according to their IFPA ranking as it stands at the time they are added to the tournament. If you add players to your tournament well in advance of the tournament date, the player rankings may change before your tournament starts. You must go to the Players -> Seeding tab to refresh the seeding data immediately before your tournament starts. Players without IFPA numbers attached or where a ranking cannot be determined will be given the lowest seed in the tournament.
Manual seeding means you must manually seed each player. This happens on the Players -> Seeding tab. By default, players are seeded in the order they are added to the tournament, and you can save a lot of time by adding players in the order of seed from top to bottom.