First of all, you need to put some henna into the carrot bag. You can do this either by spooning henna paste in from a container ("Fill your carrot bag" - worth watching just for the neat way Catherine opens out the bag), or by cutting a large hole in the end of a previously filled carrot bag and squeezing the henna out of the old bag and into the new one("Another way to fill your carrot bag"). Think of it as milking a cow.
Cut the tip
Then you need to find a good cutting surface and a sharp blade. A scalpel, single-sided razor blade, or DIY knife will do nicely. Don't try this at home unless you're confident you know what you're doing! The Henna Page is not responsible for any missing digits!
Lay the carrot bag on the cutting surface, making sure the seam is furthest from you. Here comes the clever bit. Take the blade, and cut off the very tip of the carrot bag, at an angle. The diagram below shows exactly what to do, and here is the video clip ("Cut the tip").