Murray Forbes, managing director of an Australian toy company, is dumping his suppliers in the southern Chinese coastal town of Shantou for good.
He found that plastic parts in some of the toys were too small for children and the safety of the paint used was questionable.
"I know now that some of the toys we distributed weren't necessarily compliant (with safety standards)," he said.
Forbes is now careful to make quality checks following a wave of global recalls of unsafe goods made in China, which is the world's leading toy maker, and high-profile scares last year over millions of toys shipped to the US and Europe.
Although his five-year-old company has not been affected by the recalls, Forbes, like many foreign toy companies, has become extra stringent on quality control.
"Before, we used to buy what we thought was a good looking item that's not necessarily tested, whereas now we'll make sure it's tested," said Forbes who was attending the Toys and Games Fair in Hong Kong, the world's second-largest toys exhibition.
Forbes was among the 15,000 foreign buyers at the fair as the industry tries to salvage its tarnished reputation following the safety scares, including US giant Mattel's recall of 18 million toys over concerns about toxic lead paint and small magnets that children could choke on.
Chinese authorities have since tightened quality controls and banned hundreds of factories from exporting their products as part of efforts to crack down on dangerous goods.
Hungarian buyer Schekk Tamas said he remained confident about Chinese goods and had not requested more checks.
"We have stable partners. There is no need to do that because we have trust in them," he said.
But there are plenty of other buyers who fear China's new measures aren't sufficient.
Australian Jane Critti said her customers had expressed worries about the Chinese label and she was considering doing her own checks.
"It's my responsibility to make sure the toys are safe," she said.
American buyer Roberta, who declined to give her surname, from a US mail order company said she was also forced to undertake more tests to avoid the problems Mattel had.
However, she remained unfazed over the safety of products from China where 30 percent of her toys are manufactured.
"We've been doing this for 20 years. Unsafe products are let in because they are not checked properly," she said.
"(Chinese toymakers) are innovative and easy to work with; they have the capability and the facilities that we don't have back home," she said.
Demands for tighter safety controls have increased costs for Hong Kong toy companies, which are estimated to account for more than half of China's toy exports and 85 percent of those to the United States.
Despite the recalls, China exported toys worth 7.1 billion dollars in the first 10 months of 2007, up about 20 percent on a year earlier.
Shipments of toys and games from Hong Kong, the world's second largest toy exporter, rose 25 percent last year.
In addition to the recall scares, toymakers are worried about soaring costs, so much so that Lawrence Chan, chairman of the Hong Kong Toys Council, warned that hundreds of the 4,000 Hong Kong-owned toymakers could face closures this year.
He estimated that production costs will climb 15 percent this year as demands for stricter quality control, a strengthening Chinese yuan, rising labour and raw material costs and high oil prices hit bottomlines.
Samuel Shum, vice president of Hong Kong's 35-year-old Manley Toys Ltd., expects to increase prices by as much as 10 percent this year.
"We cannot increase our price too much because no matter how beautiful our products look, we'll scare away customers," he said.
Shum however believes fears over Chinese products have begun to fade and predicts better sales this year.
Some overseas buyers such as Critti said they felt a 10 percent price rise was acceptable but warned they would consider looking elsewhere if their customers find the increases too much.
But one thing buyers and manufacturers can agree on is that the recalls will shake up the industry.
"We are going through this transitional period. Everyone is making changes and I believe this will only raise the quality of the products," Shum of toymaker Manley said.
Australian buyer Forbes said: "This can make sure toys comply with safety standards because there're plenty of toys that didn't. I think it'll actually be positive to clean up so a lot of factories stay closed."