CPSIA Legal Management podcast Retail Small Business

Heard in the slammer: “I used to make handmade toys”

One of these days, my granddaughter would love it if I bought her a little homemade bear like the one in the photo.

Trouble is that after February 9th 2008, it’ll be a violation of Federal law to sell it to me.

Doesn’t matter if it’s sold at a small retailer, a craft fair, a resale shop or in your expensive, high-end, fancy pants, mostly-imported toy store. Bottom line: If you sell or handcraft toys or clothing for kids, it’s entirely possible that you will be out of business as of February 10th 2009.

Read that again. It’s 56 days from today (Dec 15, 2008).

While it would be easy to dismiss this as me overdosing on too much caffeine, I’m sorry to say that isn’t the problem.

CPSIA – A Slam Dunk

Remember Christmas 2007?

Not only were retailers flush with good retail sales, but the news was full of recalls of defective toys from China and elsewhere – in some cases, toys made in the Chinese plants of American toy “manufacturers”. Lead was a prevalent issue.

These problems angered the nation at large and embarrassed Congress. In those circumstances, its just a matter of time before legislation results.

In this case, the result was the Consumer Product Safety Improvement Act (CPSIA). If you’re a craftsperson who makes toys and kids clothing or a retailer who sells these items, the CPSIA is your Patriot Act and you aren’t the good guy.

This law was so well-favored that when you combine the results of the House and Senate votes on the final legislation, it received only THREE “No” votes.

More presidential candidates MISSED the vote than did those who voted against it. 

The Consumer Product Safety Improvement Act (CPSIA), passed on July 31 2008 and signed into law by President Bush on August 14 2008. The Act makes it illegal to manufacture or sell toys, clothing and other items for children that do not meet the act’s testing and labeling requirements. The Consumer Product Safety Commission’s budget has been increased by $620 million so they can enforce this law, whose details were largely left up to the commission.

All it would have taken to help small business owners exemption-wise was to include some common sense testing and labeling exemptions for all natural toys and clothing. That would have left a good piece of legislation in place, without threatening a ton of home-based businesses.

Unfortunately the CPSIA contains nothing like that. Work at home folks don’t have a big lobby in Washington. The handcrafted wooden toy crowd has only the newly founded Handmade Toy Alliance, which at last count had fewer than 100 members. As you might suspect, they aren’t a power player in Beltway circles.

The big boys like Mattel, Wal-Mart and Toys-R-Us are substantially impacted by CPSIA, but quite frankly – if they had been better corporate citizens from the outset, we wouldn’t be having this conversation.

Mostly, this is great news for parents trying to find better products for their kids.

There’s always a “but”

Again, there is nothing in the Act that eliminates or alters the testing and labeling requirements for those that use 100% all natural materials during manufacturing. Perhaps that was considered a loophole that was just too big.

Is petroleum a natural substance? If so, then all plastics must be too, right? And why isn’t lead?

Before you go off the deep end about your cousin who chewed on too much lead paint when he was a kid, I have to say that in general, I am a fan of this legislation. It’s the only way to get large importers and offshore manufacturers to get their act together.

Obviously this law was sorely needed to deal with repeated instances of imported items containing lead, small parts on infant toys, much less the weaknesses in our existing regulations.

Objects in your mirror are larger than they appear

If you think a little harder, the target is much bigger than a bunch of craftspeople selling their wares on (link goes to their open letter to the CPSC re: CPSIA), eBay, craft fairs and small local retail shops.

Anyone who sells this stuff has a new cost of doing business to add to their expense list. Anyone who has these items in inventory has to get rid of that inventory by February 10, 2009 (some can wait till August), or pay to have it tested and labeled per CPSIA requirements.

While the large manufacturer suddenly has a substantial new COGS item, it’s the little guy is the one who is going to suffer the most because they simply can’t afford the testing that is required.

For example, there’s a retired lady here in the Flathead Valley who makes little wooden trains in her garage woodshop. She carefully scans paint manufacturer websites and questions their representatives by phone to be sure there’s no lead or other nasties in the paint she uses on her carefully made toys. Her business is history if the CPSIA stands as written.

I just don’t care…or do I?

You might be thinking that you really don’t care. Maybe you don’t have kids or you only buy toys and clothing from major American manufacturers (er, I mean importers). Or maybe you don’t own a store that caters to kids, so why would you care?

It’s time you started caring, but let me help you decide. Here are a few examples of businesses that will be impacted by the CPSIA, otherwise known as “reasons to care”:

  • If you make wooden trains in your garage and sell them *anywhere*, you get to pay $4000 per toy to a 3rd party testing lab to assure compliance with the CPSIA.
  • If you make sock monkeys at home and sell them at your local craft fairs and tourist shops, you have three choices: sell them in violation of the law, close up shop or pay the fee to have your items tested. Each SKU = $4000, most likely.
  • If you own a small toy store, sell items that cater to kids, or you sell antique toys or anything else that comes to you without CPSIA-compliant labeling, you have to pay to test every item, or make sure that it has been tested. Presumably, testing a small sample of the same lot is acceptable, but “presumably” is not a way to stay legal. I suggest contacting a testing lab and/or attorney for more info.
  • If you import all your toys from Europe, you have to have them all tested, despite the fact that Europe has for years had stricter toy safety standards than the U.S. Again, the same advice as above regarding testing of items in the same lot.
  • If you create or sell science kits for homeschoolers, the CPSIA appears to apply.
  • If you’re a school who buys such kits, your vendors may also be subject to it.
  • Every U.S. toy manufacturer who actually manufactures items here at home – and likely had nothing to do with the toy recalls from 2007 – still has to pay to test their toys. That part makes sense, unless the items in question are made from 100% natural materials.
  • If you enjoy shopping for your kids at craft fairs, online at or eBay, or you like buying used toys and clothing – sales of items that do not conform to CPSIA regulations and that have not been tested will be illegal to sell to you.
  • If you sell items for kids on eBay, all your existing untested or non-compliant inventory has to be sold before February 10 or it cannot be sold without being tested. The phase-in starts with larger concerns, but it’ll get to you before you know it.
  • Retailers can be held liable for selling any handmade toys or children’s items that are not tested by a CPSIA-compliant lab and labeled per the CPSIA.

If you don’t own a business that has anything to do with kids, don’t think it doesn’t impact you. Think about the owners, employees and family members of the businesses described above. They might not be spending money in your store by the time the CPSIA gets done with them.

Do these artisans buy computer paper, coffee, towels, hamburger, gasoline, haircuts, dog grooming, fine wines, appliances, landscaping, envelopes or tires from you?

What will they buy from you if they are put out of business by this law? Are you in line for a bailout?

Suddenly, it’s time to care, eh?

What do I do next?

First, call your Senators and your Congressional Rep. DO NOT email them. DO NOT fax them. Those things are far too easy to ignore.

Call them and hold their feet to the fire.

Next…Research and legwork.

Remember that your existing inventory falls under this law, whether you are a retailer or a manufacturer, regardless of size. Some of the regulations kick in later in the year, so I suggest you read this coverage at Fashion Incubator for additional details. Here’s additional info on what must be tested per the CPSIA.

You have 56 days as of Monday December 15.

The full text of the law is here: HR 4040 or if you prefer a PDF, here. Check out the CPSIA frequently asked questions (FAQ) list at

Speaker of the House Nancy Pelosi’s website does a nice job of summarizing this well-intentioned, but incomplete bill.


20 replies on “Heard in the slammer: “I used to make handmade toys””

[…] This post by Business is Personal is the most thought-provoking article I’ve read on the issue. Check […]

[…] ebay provide a host of new, fresh ideas on homemade items you can buy.  And then I came across this…and this and I thought to myself “Is this what my world is coming too?”  Are […]

This goes beyond toys as well. Those of us in the cloth diapering whelm will be effected too. So many wonderful kids items will be put to a stopâ?¦only the big big companies, who brought in lead to begin with, will be able to continue forward in all this.
As this is currently written too it effects 2nd hand shops as well.
it is very very wide, vague, far reaching, and not well defined.
It is a sad shame.
I am still hoping as this law is defined there will be ways for us smaller unique businesses to remain.

When you contact various senators, many do not even know what they passed. They just give some save the children speal without commenting and/or realizing the impact on small biz.

Also when you call CPSC directly and get various repsâ?¦they tell you different things. In the Cloth Diapering whelm we have been told anything from they are exempt to they fall under at least 3 testsâ?¦ changes when you talk to different reps w/in the cpsc.

You really should contact your senators and reps and let them know the impact on either your biz or any small biz you like.

Excellent summary of this law. I only found out about it yesterday, and have been researching non-stop for 24 hours! My question is this: what happens to all of my children’s name-brand clothing and toys that I would normally sell on ebay, at consignment stores, on Craig’s List, or at yard sales?
Thank you!

[…] with permission from Rescue Marketing by MARK on DECEMBER 15, […]

[…] Heard in the slammer: â??I used to make handmade toysâ? […]

Thank you for this very concise and well-written article. I am posting a link to it on our blog. It makes me really sad that although it was written nearly a month ago, it’s information is still current.
Hopefully by next month this time we are going about business.

[…] That would take action by Congress, however, because the Consumer Product Safety Commission’s general counsel has already determined that the law applies retroactively, said commission spokesman Scott Wolfson. Read the rest of the article here. Ok, well, where to begin? First of all, this is obviously too ham-fisted a measure. What is the point to checking items which have no potential for containing toxins whatsoever? Indeed, that’s a pointless venture. And a costly one at that, one which will be ill-afforded by anyone without deep pockets. This new regulation is way too broad in its scope, and needs to be pared down considerably to only include objects that have the potential to, you know, contain toxins. So right off the bat, this new proposal lacks the focus that it needs – and what happens if these widespread measures ‘gum up the works’ and backlog? The potential for disaster is, well, pretty disastrous in its scope. And potential market halting aside, just think of the potential damage to, well, capitalism.  The essence of capitalism is the little guy, working his way up the ladder, playing the system, bartering and trading with all the other little guys, and making his way in the world. That’s the free market at its best, and ideas are sustained or they fail based on their merit or lack of. This new proposal has the potential to ensure that ideas are sustained only if their propogaters have deep enough pockets to ensure that their product stays in the market. The damage to the ‘little guy’, and to start-up companies because of this new regulation is going to be horrendous. Consider this example: […]

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