Kinda hard to explain without a picture. But picture this:
You are walking on one side of the road. On the other side there is a bank that you wish to go to. Where would you cross so that you would cross the road in the least distance possible? (ie. where would you cross so that you were the closest to the bank?). Well, when you get directly opposite it so that your 'position' relative to the bank is perpendicular to your 'direction' (which is down the road you're walking).
This is the same concept. When your position relative to the point you are concerned about, is perpendicular with your direction, then you are closest to it (or furthest, but let's not worry about that).
So position =r, direction =v. When r.v=0, they are perpendicular and so you are closest to it at that point.