Take a look at the fraction $\frac{36}{40}$. We say this fraction can be "reduced" because both 36 and 40 have at least one common factor (other than 1). For example, both can be divided by 2.

$\frac{36\div~2}{40\div~2}\,=\,\frac{18}{20}$

$\frac{36}{40}$ is the same amount as $\frac{18}{20}$, but $\frac{18}{20}$ can be reduced even further.