We are occasionally brought items that have been monogrammed previously... either a vintage find that came with an embroidered monogram or a gift from a well-meaning friend who gets the monogram not quite right. And we're asked if we can fix it.
The answer is usually yes. If we can unpick the existing stitches without damaging the underlying fabric, we can embroider over the old design with a new one that either completely or mostly covers the needle holes in the fabric. If it's a natural fabric, we then steam the fabric to close those old holds and the new embroidery is as good as new.
If it's a synthetic fabric, like a gym bag or backpack, the fabric is usually quite resilient and the needle holes from the original design don't stay behind when the thread is removed. However if they do, we often suggest adding a logo or motif to make the design larger, or even a stitched background (similar to a patch) to cover any flaws. This is a great way to repair an item that has a hole.
The only fabric that is difficult to unpick is natural leather, as the needle holes won't steam closed. Once leather is pierced, the damage to the leather is permanent. So a larger design or patch is required to cover any previous embroidery.
Here's an example of a recent project where three LLBean boat totes were brought to us for re-monogramming. They had been purchased and monogrammed in American and gifted to three grandchildren. The design put the surname initial in the centre, which is standard practice in American, but was confusing to the three young girls when they received the bags.
We unpicked all three monograms, eliminating every stitch in each design... 
... cutting thousands of tiny stitches so that the thread could be removed....
... and then we steamed the needle holes closed.
The new monogram design that was chosen, using our simple Schoolbook font with the initials in the standard order, looks quite modern and fresh on these bags. They're as good as new and the monograms are now perfect.
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