We have a four shelf book shelf with clear plastic shoebox containers. These hold Little People, doctor kit, pull back cars, blocks, etc... I also have the puzzles on one of these shelves. We have a padded bench storage box that holds big vehicles like fire truck and tractors. We have a fabric cube bin for cars. A wheeled rectangular basket for all Imaginext stuff. A retangular basket for stuffed animals. All kitchen stuff goes IN the play kitchen cabinets. I also have a tall plastic bookshelf in the toy room closet for big sets like Lincoln logs, wooden trainset, chunky Legos, Little People house and ramp. Anything with "parts" is in a clear plastic container.
We have done this since my 3 1/2 year old was 1 and he knows where everything is and where everything goes! I am a little OCD and therefore am very organized, We only get out so many things at a time and pick up periodically throughout the day. We also pick up before dinner, when Daddy get home, and at bedtime. It never gets unmanageable.