I checked the shops for the least expensive plain ole t-shirt I could find, it was $4! 
Then I found a website called sewingpatterns.com, the great thing about them is that they have tons and tons of patterns and a lot of them are downloadable. I found this one that should take care of my immediate needs for puppet sized clothes, it was only $3.99 to download or paper pattern and has pants, shorts, t-shirt, dress, vest and jacket. Great find!

I like those, so cute!