Walkthrough for Sharel’s Masterwork quest, A Bloody Craft in Pathfinder: Kingmaker.
To unlock this quest, you must claim the Northern Narlmarches, which you’ll be able to do when you raise your Community Kingdom Stat to Rank IV. After that, found a village in the Northern Narlmarches and visit it, where you’ll find a guard accosting a half-elf named Sharel. Intervene, return to the capital and talk to Hassuf to acquire Confirmation of Sharel’s Innocence, then return to the guard and pick the [Lawful Good] or [Chaotic Good] choice to exonerate Sharel.
Sharel will then offer his services to you. Accept, build Sharel’s Sewing Shop in the village, and Sharel will start crafting items for you. Shortly after bringing you your first item, he’ll ask you to visit him in the village in the Northern Narlmarches, starting this quest in the process.
Travel to the village you founded in the Northern Narlmarches and talk to Sharel, who will tell you of another tailor named Morhalan, who is sourcing materials unethically. Agree to track down Morhalan’s hunters to score 180 XP and he’ll suggest you look around the “Narlmarches”, which isn’t much to go on, since the “Narlmarches” includes half your territory.
Travel around the Northern and Southern Narlmarches until you trigger a random encounter with some poachers, including a Poacher Alchemist and two Poacher Brawlers. The alchemist is a pain, as alchemist tend to be, and should be your priority lest he have free reign to pelt you with bombs. While the alchemist is a nuisance, the two Brawlers are mid-level barbarians with plenty of HP and decent Attack/Damage output - nothing compared to the Owlbears you’ve been fighting, but still dangerous enough that you should exercise caution. Bring them down and loot them - the barbarians will both drop a Falchion +1, a suit of Hide Armor +1, a Ring of Protection +1 and a collection of coins, baubles and potions, while the alchemist will drop a Chainshirt +1, a Light Crossbow +1, various alchemical concoctions, and a chest full of Lizardfolk Skins.
Pick up the chest and return to Sharel in your village in the Northern Narlmarches and he’ll confirm his own suspicions and decide to take the initiative with the rest of the matter. This earns you another 180 XP.
The quest will go dormant after this point, only resuming the next time Sharel brings you an item in your throne room, which will probably take several weeks of in-game time.