Working on the right side of the towel, use a sewing machine or needle and thread to stitch the trim down the length of one long edge.
Lay the towel right side down, placing the embroidered trim edge at bottom. Fold the length of the bottom edge up to reveal the trim and create a 7-inch pocket. Pin and then stitch the folded towel together every 3 to 6 inches to create divided pockets. Note: Before stitching the edges of the first pocket on the right-hand side of the towel, arrange baby buttons and rickrack along the edge on the other (right) side of towel as shown in picture. This edge will become the top of the rolled-up case. Stitch the desired arrangement of buttons and/or rickrack in place.
If you prefer to use ribbon to tie the case, fold the ribbon in half and insert the folded edge halfway down one side of the towel. Trap the folded ribbon in the stitches when the side edges are joined together to make the last pocket. If you choose a touch fastener to seal the case together, first stitch a scrap of trim to the back of the hook portion of the touch fastener. Insert one edge of this tab halfway down the edge of the towel. Trap the end of the tab in stitches when the side edges are joined together to make the last pocket. To gauge the placement of the loop portion of the touch fastener, insert various items into the finished pockets. When the case is rolled up, position the loop portion to fall under the hook tab and then stitch it in place.
Buy an additional decorative button to make a matching gift card.