Now that your vinegar is already and your chillies are dried you can get on to making your pickled onions or shallots.
I tend to buy 1kg of Pickling onions or Shallots at a time as it is a time consuming exercise peeling the skins off. However I get my Nan's stool out, pop the radio on and then I start.
First of all I get a big bowl or bucket which has been cleaned (I have bowls and buckets that I only ever use for food and which are not used for anything else) I usually sterilise them with baby sterilising tablets to start with. This is the bucket that the peeled onion/shallots will go into.
Then I place the onions or shallots into another sterilised bowl or bucket. I then pour on boiling water to soften the skins until they are covered. I leave for about 10 to 5 minutes and then fish out with a strainer an onion or shallot at a time and using a sharp knife I peel off the skin. I would advise at this point tht once you start preparing the onions it might be wise to wear a pair of gloves as the onions will badly stain your hands otherwise. The base of the onion I slice off really finely - you do not want to chop it off completely as this is what holds the onion/shallots together.
Shallots are slightly different in that there may be two or three bulbs within what appears to be one large shallot. The colours can vary as well, sometimes a grey-purpley and sometimes yellow spots (this is all normal). I usually split these down taking any leaves off as I go. Once the onion or shallot is peeled I pop it into the sterilised bucket.
Once all are prepared I then get another large bowl and layer a few onions/shallots at a time. I then sprinkle a fair amount of salt between each layer. This is known as dry brining and the salt removes any excess from the preserve so that it does not go soft and mushy and gives you a nice crisp pickle. These are left overnight covered with a tea towel in a cool place.
The next day, I boil up the spiced vinegar and then leave it to cool. If you add hot vinegar to the onions or shallots then you will lose the crispness of the pickle. I usually pop a tea towel or muslin over the vinegar whilst it is cooling.
If you prefer a sweeter pickled onion/shallot, add about an ounce of sugar to the vinegar and stir until dissolved then carry on as before. I tend to make them without sugar as OH is Diabetic, but that is down to personal choice at the end of the day. You can use other vinegars as well so experiment as to what suits you. There are all sorts of variations out there on the Internet. I tend to make mine though the way my Nan taught me. I absolutely loved her shallots and pickled onions. She used to grow the shallots and the pickling onions as well so maybe that had something to do with it. Anyway I digress.
Sterilise your jars yet again with baby sterilising solution or heating them up in a hot oven to sterilise them.
Rinse your onions/shallots in lots of cold water using several lots of water if necessary to get rid of the salt. It has been used for crisping up the onion/shallot and the removal of any water. Set them to one side until drained. Cloth over the top whilst this is happening.
Then taking one jar at a time, (using oven gloves) add an onion or shallot one at a time dropping them into a jar. I use a wooden spoon handle to locate the onions where I want them you want as few a gap as possible and with the onions and shallots not being a uniform size you do have to fiddle with this a little bit but you can only do what you can do. I pack the onions/shallots in as tightly as I can right to the neck of the jar. I then drop in some mustard seeds, some black peppercorns, a couple of fresh bay leaves and one dried chilli. I then top up with the vinegar to the neck. I then burp the jar to get rid of any air bubbles. I have a long skewer that I use for this purpose. I work round the jar with the skewer releasing any air. Sometimes from the outside of the jar you can actually see where the air pockets are. This needs to be done as air is the enemy within any preserve. Doing this can sometimes make the vinegar sink down the bottle more. To make sure the onions/shallots are kept submerged under the vinegar I add more vinegar, and also a tight wadge of new greaseproof paper to place on top of the onions and shallots which forms a stop between the jar lid and the preserve and keeps everything tightly under. Years ago you used to be able to buy some round perforated discs with four legs on that you used to place in top of the jar which did the same thing but I have not seen them for years but the greaseproof paper works just as well. Then pop your lid on. I use coated lids at all times as vinegar reacts badly with unsealed metal lids.
Place on your pantry shelf. As a rule of thumb I will not let anyone touch my pickles or chutneys for at least six weeks which gives them time to mature. However, if you are not keen on chilli, probably take it out about three to four weeks so that the preserve does not get any hotter. We like tangy pickled onions/shallots here.
How to use them:
Have some as part of a Ploughmans salad, serve with good cheese, a bit of chutney and a bit of "fruit cheese", cold meats, pate, ham etc. Also add into casseroles and stews.
Hope this helps.