First, open the template (provided at the end of this post) in Photoshop. Create your design, making sure you stay within the interior teal guide lines. This will ensure that you have a 1/2 inch are around your design for when you cut it out of the fabric.
After you have created your design go to Edit>Define Pattern...
Name Your design whatever you would like and hit Ok
Now go to File>New...
Create a document with a Transparent Background and with the dimensions listed above.
If the picture above is too small for you to see they are:
Width: 2700 pixels
Height: 3150 pixels
RGB Color 8 bit
With the new document window selected click Layer>New Fill Layer>Pattern...
If the box that pops up looks exactly like the one in the picture above then Click OK
From the small box on the left hand side of the window that pops up select your design pattern that you just selected with the Scale set at 100% then Click OK
In the Layers window on the right hand side Right-Click on the layer with the design pattern and click Rasterize Layer
Use the selection tool and select the partially cut off design on the right side of the canvas
You need to erase the partially cut off label design that you just selected, so you can do that by using the eraser tool or by simply hitting the Delete key
With the partially cut off labels erased now click Select>All
Now you should move your label designs to the right so they are centered on the canvas. You can use the Move Tool or the right arrow on your keyboard
With the labels centered in your canvas all you have to do now is save your file as either a JPEG or PNG and then upload it to the Spoonflower website