In the toy story universe there is only one great big toy factory that makes all toys. The factory is built on a radioactive mound of nuclear waste that happens to be infested with radio active spiders and is on top of an indian burial ground. This factory has a long and rich history starting as a blacksmith shop that only made mechanical owls for Zues. The blacksmith shop was destroyed by a great flood, then years later the building was purchased by a man named Gepetto, who diisappeared inside a whale. It was then the shop expanded into more of a factory and began producing top hats for magicians, one of these hats was found by a group of children which lead to a lawsuit filed by the state of Road Island holding the factory responsible for artificial life. The factory was closed down once more and remained empty for years then was purchased by a defense contractor who built a line of robots only to have the another lawsuit brought against them when the fifth robot proclaimed himself to be "alive". Johnny 5 was taken apart (congress refused to classify him "true life" thus his disassembly was not looked upon as murder) while studying the metallic mystery - scientists made a remarkable discovery, there was something about the factory itself. It seemed to have the ability to give life to selected objects. Religious fanatics saw this as a sign of the apocalypse . The factor was once again shut down - until 1989. A construction crew digging not far away from the crumbling structure made yet another startling discovery -- the factory had been built on top of a radioactive mound which itself was on top of a leprechaun graveyard, which was put there to block the entrance of a cave that was believed to be a gateway to hell inhabited by free floating munchkin boogans.
So see, this mixture is why you have talking toys in toys story.