China’s toy industry’s “golden era” of overseas expansion is facing unprecedented challenges as traditional toy manufacturing factories are facing difficulties, closures, and bankruptcies becoming a norm in the industry. On April 20th, four factories in Yulin, Guangxi, including Yingfeng Factory, Huayao Factory, Wanfeng Factory, and Chuangfeng Factory, were shut down, leading to protests by thousands of workers demanding settlement of wages and legal compensation. Last December, Dongguan’s Changrong Toy Factory ceased production, leaving tens of thousands unemployed.
The announcement came on April 20th from Guangxi Huasheng Yingfeng Toy Manufacturing Co., Ltd. (“Huasheng Yingfeng”), declaring bankruptcy and entering liquidation proceedings. The company is part of the Hong Kong Huasheng Group.
Huasheng Yingfeng owns four factories in Guangxi: Rongxian Huayao Toy Manufacturing Co., Beiliu Huasheng Yingfeng Toy Manufacturing Co., Beiliu Wanfeng Toy Co., and Beiliu Chuangfeng Plastic Electronics Co. This marked the simultaneous closure of all four factories.
The notice cited various reasons for the shutdown, primarily escalating US-China trade tensions affecting overseas markets and substantial overseas client payment defaults leading to a complete breakdown of the financial chain, making it impossible to sustain operations, hence the reluctant exit.
The company claimed to have made efforts to pay February and March 2026 salaries to all employees. The notice mentioned prioritizing “ensuring employees’ wages, statutory compensation, and other legal rights,” but did not specify the compensation standards, amounts, or payment timelines.
At present, Guangxi related factories have not disclosed compensation plans post-closure. The bankruptcy asset disposal process is lengthy, leaving workers facing income loss and uncertainty about their future placements.
Public records show that Huasheng Yingfeng was established in 2021 and is under the Hong Kong Huasheng Group, a company founded in 1976, engaged in toy manufacturing outsourcing with factories in Guangdong, Guangxi, and Southeast Asia. Due to changing orders in recent years, some factories have ceased operations.
On April 23rd, a blogger known for tracking collective protests in China, “Yesterday @YesterdayBigcat,” posted on X social media platform, reporting worker protests starting on April 21st in three of the factories involving around 5,000 employees.
In Rongxian Huayao Factory and Beiliu Yingfeng Factory, workers blocked roads outside the factories to attract attention. Some workers at Yingfeng Factory went on the factory building’s roof displaying banners. In Beiliu Chuangfeng Factory, workers not only held protests but also put up banners outside the factory with slogans like, “All youth devoted to Huasheng, bankruptcy shouldn’t mean breaking promises, give us back our hard-earned money.”
Authorities in Beiliu and Rongxian deployed police to disperse the protesting workers, but no clashes occurred. On April 22nd, workers continued their protests. Reportedly, a deputy mayor of Yulin City intervened in the issue. However, as of that afternoon, the protests had not achieved substantial progress.
On April 25th, “Yesterday @YesterdayBigcat” revealed that the protests by 5,000 workers at Huasheng Toy Guangxi Yulin Yingfeng Factory, Huayao Factory, and Chuangfeng Factory had entered the fourth day with no willingness from Huasheng to settle wages or compensate workers. When Huasheng closed Dongguan Changrong Toy Factory at the end of 2025, they, with the Chinese government’s support, defaulted on half of the compensation and only compensated workers at a “0.5N” standard.
According to relevant provisions of the Labor Contract Law, employers should compensate at least at an “N+1” standard.
As reported by Radio Free Asia on April 27th, a worker named Li told local journalists on the 24th evening that, “When the company closed Dongguan Changqing Toy Factory last year, they only compensated us at a 0.5N standard, not paying in full as required by law. This sudden closure is being handled similarly to last year’s situation, not in accordance with labor laws. We are worried the company will handle it the same way this time, hence thousands protesting.”
Li mentioned that they had filed complaints with the labor department but received no response, instead asked to resolve the disputes through legal channels, preventing further protests.
An employee in Rongxian expressed, “The notice came suddenly, and no one was prepared. Our biggest concern now is how wages and compensations will be calculated. We have worked hard, and the company should comply with the law.”
Outside another factory in Beiliu, workers stood dispersed, some wearing masks, conversing. A longtime employee stated, “I have been working here for over a decade, and all of a sudden, it stopped. The company hasn’t clarified compensation standards, so we had to come out seeking explanations.”
Reports cited videos from “China Collective Protest Events Record (X Account ‘Yesterday @YesterdayBigcat’)” showing numerous female workers gathered along the roads and open spaces near the factory. Some watched from the roadside, while others discussed among themselves. Some workers recorded the scene on their phones, resulting in slow moving vehicles around. Uniformed police were present to monitor the situation.
A Beijing economist, Mr. Wei, told Radio Free Asia that, “Export-reliant labor-intensive industries have been significantly impacted in recent years. Decreased orders, prolonged payment cycles, increased financial pressures on some companies have led to production halts or closures steadily rising.” Some companies shifted production to Southeast Asia to reduce costs or be closer to markets.
On April 28th, “E-Net” reported that the Guangxi toy industry leader, backed by the Hong Kong Huasheng Group and established in 2021, once operated at its peak with 40 fully operating production lines, surpassing 30,000 units in daily production. Their products were exported to over 20 countries and regions, becoming a benchmark for local investment attraction, and a successful example of Cantonese toy industry transfer to Central and Western regions. Within only five years, it collapsed magnificently.
As a factory heavily reliant on the US market, fluctuations in US tariffs directly squeezed order profits, clients delaying payments for various reasons, overlaying material price hikes and increased logistics costs, resulting in continuous cash flow depletion rendering operations unsustainable, leading to bankruptcy liquidation.
By the end of 2025, Huasheng Yingfeng’s parent company, the Hong Kong Huasheng Group’s Dongguan Changrong Toy Factory, a manufacturing giant with over 30,000 employees at its peak, announced closure and liquidation due to US clients shifting orders, leaving thousands unemployed as the factory was auctioned off to cover debts.
The journey from Dongguan Changrong to Guangxi Huasheng Yingfeng in a few months saw the collapse of two core production bases of the Hong Kong Huasheng Group, reflecting the dead-end of the traditional toy manufacturing outsourcing model.
The closure of Huasheng Yingfeng is not an isolated case. In recent years, under the multiple impacts of trade tensions, rising costs, and order transfers, domestic traditional toy manufacturing factories have been increasingly troubled, closures, liquidations, and bankruptcies becoming a common industry occurrence with a domino effect in progress.
In June 2025, Huasheng Toys in Qingyuan, Guangdong, announced a temporary production halt; in July, Shenzhen Fengda Toys dissolved for liquidation, shutting down its factory; in December, Shenzhen Shenli Toys ceased full production. On December 23rd of the same year, Dongguan Changrong Toy, with a 26-year history, formally closed down, pushing thousands of workers into unemployment. This once hailed enterprise as the “world’s factory” could not escape industry winter.
Most subcontracting factories heavily rely on European and American markets, with Huasheng Yingfeng receiving 85% of orders from the US. The tragedy of Huasheng Yingfeng is not the end but a beginning, reminding every toy industry stakeholder that when the era abandons you, it won’t even bid goodbye.