Wood selection is the primary consideration that most woodworkers go through when they decide to make something. This is an even bigger consideration when making homemade wooden toys, because it has to be a wood that works for the child.
If I were making a wooden toy tool set for myself, I would definitely make them from an exotic hardwood. Cocobolo, Rosewood, and Goncalo Alves come to mind immediately. The problem with exotic wood is that some people have allergies.
When making handmade wooden toys for kids, be sure to look at the kinds of woods that you are using. Choose from the same kinds that are already being used successfully, and you will be on the right track.
Most wooden toy makers use Pine, Maple, Beech, and Cherry when they make toys. These woods have a decent track record with a small amount of allergies, and are a good place to start looking.
There is no wood that anyone can recommend to you that will be 100% safe for every child, so you need to talk to the parents and see if they have any known issues with certain types of wood.
Making Strong Glue Joints On Your Wooden Toys
Most toy tools are made from several parts, and they are glued together. This is an example of a time when making a good joint is even more important than normal.
When you glue things together, the glue forms a bond between the two pieces. The bond is only as strong as the relationship between the pieces, and the quality of the joint.
A loose joint, or a poor fitting joint will not hold up well. If you have pieces that don't lay next to each other without wobbling, all the glue in the world won't help you.
It is important that you spend the time to make good Wood Finishing and fitting pieces before you glue them. I wrote a whole article on Gluing Wood if you need more information.
Using Dowels For Additional Strength In Homemade Wooden Toys
Homemade toys are going to take a beating. Kids just play harder with things than adults do, and you need to take that into consideration.