Place the main character in a setting that gives her the opportunity to tell a story and listen to individual stories. This setting can be any location that calls for a social gathering. Events like family get-togethers, meetings with friends or parties are all acceptable starting grounds for a frame story.
Outline the events in the story. Give each character that is telling a story a main purpose within the story and a conflict. Make the effect of the overall story stronger by giving the characters a reason to tell their stories and a reason to be invested in the stories they hear from other characters.
Connect the characters' individual stories to the setting where the main story takes place. A clear connection between a character's story and the setting of the story will have a more powerful effect on the overall story.
Write satisfying conclusions for the characters' stories and the overall story. A satisfactory conclusion should reveal a connection between the characters' stories and the overall story.