Here's an easy birthday gift to have on hand if you (like us) go to lots of birthday parties... I keep a few brand new white towels in stock for this purpose. A little heat'n'bond, some zig zag stitching, and voilà!... Personalized towels. (my kids love theirs, and I'm secretly working on some beach towels with the same lettering as their bath towels)
I also like putting a little loop of fabric or ribbon in the middle to make the towels hang easily from hooks.