In this jacket there are some velvet and some cord squares. The edges of the squares were overlocked on a sewing machine and the knitted edges were picked up through the sewn stitches.
See Second Thoughts Pages 88 -
Any fabric with holes can be used as a base for knitting. Pick up the required number of stitches through the holes, as if picking up from another piece of knitting. You will be very fortunate if you find holes that exactly match the number of stitches needed. If the fabric is soft it can be bigger than the knitting as it will fall in soft gathers. If it is not flexible you will need to calculate the distribution of the stitches and, maybe, increase or decrease on the next row to give the exact number.
You can make your own holes in firm fabrics such as felt or leather. Make your own holey fabric with a simple crochet grid.
If you use strips of fabric, like those in the photo, you will need to pick up stitches on both pieces and work outwards then stitch the knitting together. You can make this a feature with a change of colour or elaborate cast off or make it almost imperceptible by making the join very close to the fabric strips.
One advantage of using knitting and fabric together is that you can choose where to have see-