Every language that I'm aware of (other than English) differentiates the singular and plural personal pronouns in the second person. For example, Spanish uses tú and vosotros/ustedes, whereas in English, you can be singular or plural. Using the word y'all eliminates the ambiguity.
In addition to clearing up subject pronouns, possessive pronouns are made easier. How many times have you heard the awful phrase "your guys's" (pronounced [ʎɻ gäizɪz])? You becomes your, and y'all becomes y'alls (a nice monosyllabic word instead of the unwieldy your guys's). (Alternate spelling: y'all's.)
I don't care if people don't like or want to use y'all - I was once one of them. HOWEVER, if you're going to use it, use it correctly! I've seen it spelled ya'll (by native Texans, no less!), which is just plain wrong. In contractions, the apostrophe replaces the letters not written. For example, in can't, the apostrophe replaces the o of not. Ergo, the apostrophe in y'all replaces the ou of you.
Some people will ignorantly claim that y'all is singular and all y'all is plural. Singular and plural what? Y'all is plural already: you + all. Y'all can be used while speaking to a single person when referring to a group or institution ("Y'all have a nice bookstore, Mr. Smith."), and all y'all can be used for a group when you want y'all to refer to a subset of the group. PLEASE USE IT CORRECTLY.
Don't be a y'all hater - you don't have to like it, but please understand why it's used.