1. Cut fabric to needed dimensions. The fabric that I use does not fray on the cut edges. This is important for this type of bag.
2. 
Fold in edges for the top three
inches. (1/2" hem here) 
3. 
Fold the top edge of the fabric around the draw cord. Notice that this not a single fold; but, rather, a double fold (so that there is not a raw edge of the fabric showing here).
The cord must be kept along the top crease so that it does not get sewn into the hem stitch.
This is what the double folded top edge will look like when pinned.
The cord slides freely.
4. 
After stitching the top hem around the drawstring, the side and bottom of the inside out bag are pinned.
Notice that the pinning does not go completely up to the hem that was just sewn. I leave about 1 1/2" gap here.
5.
This seam is backstitched for strength.
The end on the bottom seam is also backstitched.
A 1/2" seam allowance is used.
Here are a few images of a completed bag:
After cutting the fabric, it only takes me about 12 - 15 minutes to complete each bag.