I'm being lazy and having my tailor make for me. But, it's super easy! You just fold a towel (any towel) in half. Cut a hole in the center where your head would go through. Then, use a surger to create the hole where your arms would go. And you're done! So easy! And my face towel maker, Fresco is now making towel ponchos as Serb below that are sooo cute and a little less than $200.
I'm going to find a fun beach towel and make a larger style. I've also used hand towels for my babies. Will share how they all look once they are done:)
The one by Fresco.