Lay the cardboard tool along one side of the napkin and fold over the unfinished edge. The edge should just cover the tool -- now press the fabric so that it neatly comes over the tool, just covering it -- you have now created the first fold of your hem, it will be exactly 1", do this on all four sides of the cloth.
The corners should fold over as shown in the picture below, make sure the corners are squared up as perfectly as possible, if your fold over tends to overlap outside the edge of the hem at the corner, then your napkin is not cut square -- or your fabric is not woven square -- washing the fabric before cutting is a good idea because it helps the fabric to square itself up on the grainlines -- if you sew the napkin and it is not squared up on the grainlines, it will never fold squarely or look quite right if when it is folded on your table and the corners do not match up nicely -- but then thats just me, if you don't mind it a bit off square at it works for you, then, well, that's just fine.
Now once you have all sides pressed, open each corner and snip off the little triangle, from each folded line, just as shown in the photo below.
Now, fold over the corner with the snipped off bit, and line up the folds making sure that the "fold " exactly crosses the corner where the two pressed lines come together. You can use the iron or just finger press each edge down so that it will form a mitered corner.
Now do all four corners this way, steam press to make good sharp folds.
Now fold under about 1/2 inch so that the raw edge of the fabric does not show. Press all around the napkin again, if well pressed, you may not need pins to hold the hem in place, but if you are unsure, use a couple of pins so that you do not loose the "hem".
Each corner should finish as shown above (a little blurry) then sew with a matching thread and a even straight stitch all around the napkin. If my explaination is not as clear as it could be, there are a number of other websites that are available to read through and quite probably explain something that I have miss out. After doing more than 40 of these napkins, I tend to not really think of each step along the way. Check out About.com and search for cloth napkins, or just google, home made cloth napkins and you will find a variety of ideas and methods for sewing this simple but very useful project. Each napkin from cutting to finished sewing, takes me about 20 minutes -- so you are spending more time than money on this project. If you buy finished good quality napkins in a retail store, they will cost about $15, if you get good quality cotton at sale prices you can make 4 napkins (1 meter or 1 yard plus 4 inches) for about $2.50 and an hour and a half of your time.
