Supply lines are a way to provide resources to settlements that might not otherwise have them. This allows resources to be shared as well as specialized settlements (e.g. farms) to be established specialized settlements, which can then provide their output to places in need. Multiple settlements can be connected to the same supply chains and it is possible to connect all available settlements to the same route, allowing them to share workshop resources. Supply lines can still be created between geographically separated areas such as settlements in the Commonwealth to those of Mount Desert Island and Nuka-World, and they do not require land access (i.e. a route can be created to Spectacle Island from the Commonwealth mainland).
Setting up supply lines
The only requirement for setting up a supply line is the first rank of the Local Leader perk. Otherwise, setting up a supply line is easy - select a settler in build mode, then press the key responsible for supply routes (Q on PC or R1 on the PS4). This will display a menu where the destination can be selected. Once a settler has been selected to create a supply line, they become a provisioner and will leave their original settlement to move between it and the settlement at the other end of the supply line.
Supply lines linking settlements allow them to share raw materials and stored items in the workshop. This applies to crafting and building materials, but the items themselves cannot be retrieved from any workbench other than the original settlement where they were placed.