Quoted from Better Homes and Gardens: Max out available space in an office closet with adjustable wire shelving. Use open baskets for supplies you access regularly and boxes with lids for infrequently used items. Divide papers to be filed in layered trays and set up file folders for items that require action in the upcoming month. Closets Offices, Closets Organic, Closet Organization, Closets Storage, Organic Closets, Organic Offices, Offices Closets, Home Offices, Offices Organic
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Craft space organization: If you only have a closet or a small nook (could be covered by a pretty curtain or doors), this is an awesome way to get organized - the rolling cart is at IKEA and the white boxes to the r/h side are from Michael's - often at 40% off. The ribbon/etc holder also from Michael's, but would be easy to build and probably more sturdy.
avoid a jumbled mess of mail & school papers by setting up a center for each family member. use the area to corral artwork, forms, magazines, homework assignments, as soon as they enter the house. at each week, go through the contents of each box; discard the old material and file away things to keep.
take doors off closet, paint, create shelves, install counter for desk area (look at Menards or Lowe's or Fleet Farm for 'odd sized counters' for sale), maybe mirror part of the back wall for 'light purposes, install outlets for plug-in stuff, slide plastic 3 or 4 drawer bins under counter for storage of office/scrapbook/craft stuff...voila!