Step 1: Materials
Self-adhesive vinyl sheet (mine was about $1 at Hobby Lobby)
Cardstock or file folder (optional)
Step 2: Design
I started by copying a picture of my bass of the internet and drawing over it in photoshop. Then I took that design and drew it on paper. Getting the pickups and volume/tone knobs to line up took a lot of trial and error. It helps to place the paper on top of everything and tracing where things are located. I went through at least a dozen different paper templates.
I recommend using heavier paper after you get the design down, as it's easier to keep it steady as you get all of the details to line up.
Step 3: Cutting the Vinyl
Use a pencil to trace the paper template onto the vinyl. Cut the outsides with scissors and use an exacto knife for the insides. Cut out slots for the pickups but not the volume/tone knobs.
After making sure the slots line up with the pickups, check where the knob shafts are. Mine shifted a bit between tracing and cutting, so I had to redraw the holes before cutting.
Step 4: Application
Recommended way to apply vinyl: (Thanks to Kelticfox)
1. Clean the area with Alcohol (Isopropyl Alcohol). This removes dirt and finger grease
2. Spray the area with washing up liquid and water (bog standard spray bottle)
3. Place the peeled vinyl on the soapy water and move it into the correct position (called Floating the vinyl)
4. Squighy the water out using a felt (or soft side of velcro (loops)) wrapped piece of wood with constant pressure to remove the water. Start at the middle and work to the edges.
5. If any air bubbles are present try working them out with the squighy thing or using a brand new scalpel blade pop them (using the very tip) then use the squighy thing to flatten it out.
6. Dry it off (from the water).
As this is pretty thin, I don't know how much abuse it will withstand. But it is intended for a bass, so this probably isn't a huge issue. I don't use a pick for playing the bass, so it's just for aesthetics.