Paul, let's say you're using a 3/8" diameter cutter...
Make a first cut. Then, the second cut wants to be precisely 3/8" away from the first cut so, you unscrew/remove the fence and then fix it in the new position. Make a second cut.
A spacer is fitted in the slot nearest the fence. You'll also need a second spacer to temporarily fill the gap between the two slots as you make the first pass on of the mating pieces. The other half will but straight up against the first spacer, fixed in place, with all cuts after that on this piece to sit over the fixed spacer.
Hopefully, this makes it a bit clearer?