We despise the itchy labels on the backs of baby's shirts and pants. When possible we usually cut them out which sometimes leaves us wondering whether we're looking at the front or back. So we're thinking tacking in a personalized fabric label, like the ones above, would be fun and useful.
You'll need to gather the following supplies: computer, graphics program and an inkjet printer, regular printer paper, iron-on transfer paper, utility knife, cutting mat & metal ruler, ribbon, iron & ironing board, and scissors.
Check out the detailed tutorial at Patchwork Pottery. This would make a great gift for a friends as well.