The 'can do' bag is a winner as far as phonics is concerned. It is something I devised many years ago when working with Special needs children and something I do to this day when tutoring.
I create a bag of things the child can do. This is their bag, it belongs to them and can be used anywhere. I have found parents are more interested, children love their bags because they can do everything in them. When I first assess a child for phonics I put everything they can do easily into the bag. So for example with a special needs child there may be 6 or 7 graphemes that they know the sound of. They might not be able to blend yet so I might put some picture cards in so they can practice oral blending. I would put a blending mat in, a whiteboard and pen, a letter formation book, an outline of their name laminated for writing practice, a little phonics game with some counters and a die, and a writing book. I might put some pegs, scissors, or playdough in to help motor skills. Children can roll the playdough and cut it with scissors or practise pinching little bits off with their thumb and index finger.
When I teach a new grapheme then that gets added to the pack. They may not quite 'know' it but one new sound to practice is manageable and they don't feel over whelmed because the rest of the bag they can do.