you need to build a sewing machine. They are made with the same parts that you got the sewing kits from (on your image, 5th column over, then 1 up - above the shrimp. Use that to make a sewing machine. Then you need to use the sewing kits (first column on left) to spit out thread and fabric (that is all it makes) - you need one fabric, one thread and then the machine will make something - towel is level 6 so it will take a while because after so many items made the sewing machine disappears and you need to re-make it.