I'm not making a profit - yet! But I thought I'd share what I do.
I started by making some things to sell ready-made, and spread the word that I was available for custom orders. I made things I would use myself so people could see them, and it is easy, when people ask what you do, to hold up your purse and say "I make these"! I sold to my mother, my MIL, sent gifts to people (including my kids friends) and I went to a community craft and gift fair. At that stage, all I had was business cards. I took photos of everything I made, and kept an album as my portfolio. I since invested in a couple of signs for the booth, which I think were helpful, and I handed out lots of brochures and business cards, which I don't think were so useful, because although people stopped and looked as I was handing them the brochure, I don't think they have generated any subsequent sales.
Finally, people saw me at a couple of fairs (I've done 3 fairs in my community in 2 years) and started coming to check me out (especially after I plugged that if they were there they should come say hi!) and that led to more sales and lots of requests for my website. So, dh and I have worked on that this summer, and although it's only really an online gallery, it has links for sending me emails about products, so I'm hoping that will make it easier for people to order in-stock items, and to start a design consult for custom orders, with less feeling of obligation.
Another thing I worked on, to make myself different from the stuff people could buy in the stores, was to make my service very personal - I offer in-home shopping, free delivery in the local area, gift wrapping, etc, and I also meet customers at the fabric store for custom orders. I also do machine embroidery, and that makes a special gift because people can personalize things. Mostly I am trying to get business by showing how my stuff is different from what you can buy in the store.
I keep my range quite simple - 3 types of bags, 2 types of blankets, 2 types of towels and some small accessories, but focus on the uniqueness of the pricier items. I try to keep things at all different price points to attract more customers with different budgets, and people who buy the little washcloth sets are more likely to come back for a $50 big item.
I'm deliberately trying to stay small - I don't sell outside the country, and am trying to keep everything local - because I'm fitting it around my kids, but I'm in a big city, so there are lots of local customers, in theory!