Safe finish. Non-toxic and not flaking or chipping
The options for finishing wood are endless but not all are a good choice for toys and all but a few exceptions have to be tested for lead content. Exempt from testing are natural finishes like tung oil as well as shellac. Shellac is edible and it is used, among many other applications, as a glazing agent on pills and candies. Both oils and shellac soak into the wood and harden. They do not create a layer on top of the toy like many other paints and are therefore not as prone to chipping or flaking. When picking a painted toy make sure the paint is not flaking off. Ask the manufacturer what type of paint it is and if it has been tested for lead content.
Unfinished toys are great if you want to paint them yourself. However, if left unfinished they are going to become unsightly very quickly as any kind of dirt, natural oils from the skin, ketchup, drool and anything else found around kids will soak into the wood and stain it permanently. Furthermore, moisture can warp the wood and in some cases damage the toy.
