Causes of Sales Decline in Home Textile SMEs: A Multi-Diagnostic Case Study in China’s Industrial Cluster

In the context of a rapidly evolving global home textile sector, intensified competition, shifting consumer preferences, and accelerating digital transformation have exerted unprecedented pressure on small and medium-sized enterprises (SMEs). Many such firms continue to face persistent challenges in maintaining stable sales performance, even when operating within major industrial clusters with strong supply chain foundations. This study focuses on diagnosing the underlying factors leading to sustained sales downturns among home textile SMEs, using a representative enterprise located in Nantong, China’s core home textile production region, as a case study. By employing a multi-tool diagnostic framework that incorporates semi-structured interviews, SWOT analysis, Fishbone (Ishikawa) diagram, and risk assessment matrix, this research systematically identifies internal and external constraints affecting organizational performance. Grounded in the Resource-Based View (RBV), Dynamic Capabilities Theory and Porter’s Competitive Advantage Framework, this study systematically unpacks the intertwined internal and external drivers of sales decline. Findings reveal that fragmented marketing execution, insufficient employee professional training, underdeveloped digital marketing capabilities, and weak integration between online and offline sales channels represent the most critical barriers to sustainable sales growth. Grounded in the Resource-Based View (RBV), this study proposes a structured dual-path intervention framework that emphasizes the optimization of employee competency development and the enhancement of digital marketing systems. The findings contribute both practical insights and a replicable diagnostic model for home textile SMEs seeking to improve operational stability, market responsiveness, and long-term competitiveness under resource constraints.

Home textile SME, sales decline, digital marketing

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