Repository is one of the fondamental maven concept. It's simple to understand but fair usage request a bit of practise.

You should have a clearer idea of repository management best practises through the following examples and counterexamples.

Initial configuration

This configuration come with maven without doing anything.
Maven User > Repository management best practices > 00-initial.png

The "simple project" pom.

Extended usage

Without repository manager

Maven User > Repository management best practices > 01-extended.png

Take a look on the "extended project" pom.

With repository manager

Maven User > Repository management best practices > 05-extended-rm.png
The "extended project" pom don't change, we just add mirrors section in the settings.xml (M2_HOME/conf/settings.xml or ~/.m2/settings.xml).
Take a look on the Mirrors definitions in settings.xml.

Complex usage

Counterexamples

Single repo mirroring multiple repositories

THIS IS A COUNTEREXAMPLE

Mirror repository defined in place of original repository.

THIS IS A COUNTEREXAMPLE

Annexes

pom.xml

Simple project

<project xmlns="http://maven.apache.org/POM/4.0.0" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"
         xsi:schemaLocation="http://maven.apache.org/POM/4.0.0 http://maven.apache.org/xsd/maven-4.0.0.xsd">
  <modelVersion>4.0.0</modelVersion>
  <groupId>org.apache.maven.example.repository-management</groupId>
  <artifactId>initial</artifactId>
  <packaging>jar</packaging>
  <version>1.0-SNAPSHOT</version>
  <name>Simple repository example</name>
</project>

Extended project

<project xmlns="http://maven.apache.org/POM/4.0.0" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"
         xsi:schemaLocation="http://maven.apache.org/POM/4.0.0 http://maven.apache.org/xsd/maven-4.0.0.xsd">
  <modelVersion>4.0.0</modelVersion>
  <groupId>org.apache.maven.example.repository-management</groupId>
  <artifactId>extended</artifactId>
  <packaging>jar</packaging>
  <version>1.0-SNAPSHOT</version>
  <name>Extended usage of repository example</name>

  <build>
    <plugins>
      <plugin>
        <groupId>org.codehaus.cargo</groupId>
        <artifactId>cargo-maven2-plugin</artifactId>
        <version>0.3-SNAPSHOT</version>
      </plugin>
    </plugins>
  </build>

  <dependencies>
    <dependency>
      <groupId>org.mortbay.jetty</groupId>
      <artifactId>jetty</artifactId>
      <version>6.1.6</version>
    </dependency>
  </dependencies>

  <repositories>
    <repository>
      <id>codehaus</id>
      <name>Codehaus Release Repo</name>
      <url>http://dist.codehaus.org/</url>
    </repository>
    <repository>
      <id>codehaus-snapshot</id>
      <name>Codehaus Snapshot Repo</name>
      <url>http://snapshots.repository.codehaus.org</url>
      <releases>
        <enabled>false</enabled>
      </releases>
    </repository>
  </repositories>

  <pluginRepositories>
    <pluginRepository>
      <id>codehaus</id>
      <name>Codehaus Release Repo</name>
      <url>http://repository.codehaus.org</url>
    </pluginRepository>
    <pluginRepository>
      <id>codehaus-snapshot</id>
      <name>Codehaus Snapshot Repo</name>
      <url>http://snapshots.repository.codehaus.org</url>
    </pluginRepository>
  </pluginRepositories>

</project>

Note that some repository declarations are useless:

Jetty is now available on central repository so you can remove

<repository>
      <id>codehaus</id>
      <name>Codehaus Release Repo</name>
      <url>http://dist.codehaus.org/</url>
    </repository>

Project only need snapshot version of cargo plugin so you can remove

<pluginRepository>
      <id>codehaus</id>
      <name>Codehaus Release Repo</name>
      <url>http://repository.codehaus.org</url>
    </pluginRepository>

The project don't have any dependencies on snapshot version of codehaus artefacts so you can remove

<repository>
      <id>codehaus-snapshot</id>
      <name>Codehaus Snapshot Repo</name>
      <url>http://snapshots.repository.codehaus.org</url>
      <releases>
        <enabled>false</enabled>
      </releases>
    </repository>

Advanced project

Settings.xml including repository mirrors definitions

<settings>
  <mirrors>
    <mirror>
      <id>codehaus-mirror</id>
      <mirrorOf>codehaus</mirrorOf>
      <name>Codehaus Release Repo Mirror</name>
      <url>http://[repository-manager-url]/codehaus-mirror/</url>
    </mirror>
    <mirror>
      <id>codehaus-snapshot</id>
      <mirrorOf>codehaus</mirrorOf>
      <name>Codehaus Snapshot Repo Mirror</name>
      <url>http://[repository-manager-url]/codehaus-snapshot/</url>
    </mirror>
  </mirrors>
</settings>