Crafting is any act of processing a resource to alter it or combining two resources into something new. The resources upon which crafting is performed are usually gatherables or drops. Gatherables are items the player can pick up from their environment. Some items are gatherable by default: berries, mushrooms, and fallen branches are common examples. Some items require tools to enable gathering them: for example a pick may be needed to mine ore, while a bucket or bottle is needed to gather water. Some items require a skill to gather them, and perhaps even to detect them in the first place: ectoplasm might be gatherable from ghosts, but you might need to learn spirit-version before you can see ghosts, much less interact with them. Drops on the other hand are items received after winning a combat or playing a minigame. Combat drops commonly include body parts of the monster killed: horns, feathers, scales, bones, teeth. If a humanoid opponent is killed drops might logically include bits of broken armor, fabric, potions, and anything else the humanoid might have been wearing or carrying. In some games combat drops are the major source of player gear, but droppable gear combines badly with a deep or extensive crafting system; I personally suggest that anyone who wants crafting to be a major part of their game should not make gear droppable. Minigame drops should have some thematic relevance to the game; they often include collectibles and consumables, since it's logical to assume that minigames are created by NPCs within the game, and would have prizes those NPCs could manufacture or buy in bulk.
A game's path of advancement in crafting ability is called a tech tree. The roots of the tree are the abilities the player begins the game with. The tree grows upward and branches out every time the player masters a current ability or builds a new piece of infrastructure which unlocks new abilities and/or crafting recipes. For example, a player may begin with the ability to pick up two rocks and bang them together. Initially there is a low chance of creating a stone blade, or the blade produced will be of low quality. But after banging rocks together 20 times the player masters the ability, meaning it permanently has the highest possible chance of success, whether this is 100% or slightly lower, and the blades produced are either of the highest possible quality or usually very good. More importantly, mastering the ability to make stone blades may unlock the player's ability to start practicing a more advanced skill, like making stone knives with handles. In turn, stone knives with handles may allow the player to skin killed monsters to obtain raw leather. Then the player may get to practice curing leather until they master that, which unlocks their ability to make leather armor.
Just as a tool may be needed to enable gathering, tools or larger-scale appliances or buildings may enable various crafting techniques. These tools, appliances, and buildings taken together are termed infrastructure. They are typically the result of crafting themselves, such as the knives just described - perhaps two knives can be crafted into a pair of scissors, and this tool is needed to unlock the crafting technique "fabric cutting" which is required for a whole range of clothing crafting recipes. For a building example, domesticated animals commonly require building an enclosure to keep them in, such as a pen for sheep or a barn for cows. In the rare event that a piece of infrastructure is not craftable by the player it is probably obtained from an NPC; it might be purchased or might be a quest reward.
NPCs are also a source of skills. Basic skills are often given away free, because the purpose of the player's interaction with the NPC is more to teach the player how crafting works in the game and where to find the relevant NPC than to pose a challenge. But basic skills don't have to be free, and non-basic skills rarely are. Just talking to an NPC isn't gameplay, the fun is in tackling a challenge. The NPC may name a test or price, in exchange for which they will teach the player a new skill. Or it can happen the other way around, with the character teaching the player the skill but keeping the first few results of that skill.
So, a tech tree is the map of all these skills within a game, and which needs to be learned to enable the player to learn the next. Designing a game's crafting system consists largely of creating this tech tree: both the recipes for crafting every item, and the conditions for unlocking each branch. In a pet game sometimes all of these skills are directly related to breeding or training pets. Other times pets are just one branch of a much larger tree, or may be broken up into multiple branches, like combat-companion pets vs. non-combat mounts which increase traveling speed vs. beetles which are bred to be ground up to make colorful paint from their shells. Sometimes the skills gained become part of the player of their avatar, sometimes they may exist within a pet, or sometimes they may exist within a piece of infrastructure.
Crafting gameplay can be as simple as selecting ingredients and then an action to be performed upon them, then possibly waiting for the task to be carried out. This is easy to implement and requires no skills from players; it's kind of boring as gameplay, though. Another option is that each crafting (or gathering) activity can be its own minigame. Any kind of minigame can be plugged in as a crafting step, though of course some will be a better thematic fit than others. Minigames aren't as appropriate for an activity where the results are binary (success vs. failure) or worse activities which are always successful. A minigame is much better-suited to an activity where the results are a range (minimal success, average success, perfect success; failure may or may not be included in the range). For example, it might require twenty units of ore to start a game of "smelting", which might be a tetris-clone. Surviving level one would yield a minimum amount of metal from the batch of ore, while surviving many levels would yield more metal and maybe a bonus item, like one unit of a different metal or a piece of charcoal or a refund of some of the ore.
Get at least a general outline of the crafting system written down, but it's ok if you don't know all possible gathering and crafting processes yet. Specific minigame designs should go in the mini-game section, but we won't get to that for a while yet, so if you currently have ideas for minigames write them down and stick them into an appendix for later. Similarly, put any specific ideas for crafting items, tools, appliances, buildings, quests, etc. in an appendix. I haven't talked about prioritizing core features yet either; the basic concept is that the fewer features you need to create at first, the more likely you are to actually get to a point where the first (alpha) version of you game is playable. This is often a big boost for morale and recruitment, as well as a playtesting opportunity that can result in big redesigns. I mention it here because while you may want your main crafting system in the alpha feature set, you may want to postpone some portions of it and/or any secondary crafting systems to a beta or later version of the game. It's convenient if you have separate bullet points for anything you want to postpone, so it's easy to color-code them or move them into another section when you do your prioritization step.
- Crafting system(s) [Skip this section if your game does not have crafting of any kind, or note if you intend to postpone all crafting until post-alpha.]
[indent=1]- [Describe your game's (primary) crafting system: what are you crafting out of what, by what sort of gameplay?]
[indent=2]- [Describe the most common process by which gathering is carried out.]
- [Describe each additional process by which gathering is carried out.]
- [Describe the most common process by which crafting is carried out.]
- [Describe each additional process by which crafting is carried out.]