Did you know that there is actually a difference between something that is handcrafted versus something that is handmade?
Because of the similarities between the two, they are often used interchangeably with one another.
Handcrafted Toys
Handcrafted toys, according to Dictionary.com, related to handicraft, is when manual skill is involved or in other words "an art, craft, or trade in which the skilled use of one's hands is required."
Wikipedia's dictionary definition of handcraft is "Made by hand or using the hands, as opposed to by mass production or using machinery."
Handmade Toys
Handmade toys, according to Dictionary.com, is when no machine is involved in the creation process of the item. It's all made by hand.
Wikipedia's dictionary definition is "manufactured by hand."
References
http://en.wiktionary.org/wiki/handcrafted
http://en.wiktionary.org/wiki/handmade