I do exactly as EC121.
Wife already had a rotary cutter (think pizza cutter, but sharper) and backing board. I cut a thin slat of wood 1-1/4" (I have a .54 cal) wide (I find it easier to use this rather than trying to keep the material in line with the backing board lines) to lay down the material for a cutting width and then cut strips. I then stack about 5 strips at a time and cut 1-1/4" squares off the strips with scissors. Last I trim all the corners of the squares, about 5 at a time again, to make more of an octagon. The last is just preference, like LD said square works fine.
If you haven't ever messed with making your own before this, make sure to wash the sizing out of the material you buy, hot with no detergent, and also make sure to put it into a nylon or delicates bag or else it will come out an unraveled, stringy, tangled mess. I had read to use a delicates bag, but failed to remember when I first washed some and it cost me a fair amount of material after I cut all of the tangled strands off and cleaned the edges up again with scissors.