In this guide I am going to add a new recolour for an armour, but if you want to retexture another item (like a weapon), it works exactly the same. If you are retexturing a custom item, the advantage of using texture sets is that you only have to package the nif file once, decreasing the size of your mod file and making it easier to package.
you don't have to package the nif file of that item into your mod, only the texture (.dds) files, decreasing the size of your mod file and making it easier to package.The advantages of this system when retexturing a vanilla item are: Since Fallout 3, Bethesda introduced the use of Texture sets that allow to use only one nif file with different textures. In Oblivion, when you wanted to release a retexture of an item (armour, weapon, etc), you had to make as many copies of the nif files as retextures you wanted to create, and then link the different textures to each of the copies.