When a curtain fabric industrial cluster approaches 70 billion yuan in annual output and cross-border e-commerce reaches 800 to 900 million USD, the competitive logic has fundamentally changed. The 2026 Annual Meeting of the China Home Textile Association's Fabric Branch sent a clear signal: the old model of relying solely on capacity and price advantages has hit its ceiling, and the next wave of growth will come from a combination of design, technology, and global operations.
Industry Coordinates: The Keqiao Sample and Sector Pressures
Keqiao, Shaoxing, often called an 'economic powerhouse on a piece of cloth,' serves as a barometer for the industry. In 2025, the China Textile City's transaction volume exceeded 440 billion yuan, with nearly 8,000 curtain fabric enterprises contributing about 70 billion yuan in annual output. Such scale means Keqiao is not just a production hub but also a core node for price formation and trend release. However, the flip side is that industry profits were generally under pressure in the first half of the year, with exports showing a pattern of volume growth but price decline. The dual squeeze of real estate downturn and rising raw material costs has left many companies struggling.
Liang Pengcheng, Vice President of the China National Textile and Apparel Council, pointed out that 'weak demand and trade fluctuations' are not mere rhetoric but an objective description of the current foreign trade environment. Home textiles are close to people's livelihoods and have high demand elasticity, but this also means that when consumer confidence wavers, orders transmit faster to the upstream. For SMEs reliant on exports, the essence of volume growth with price decline is a weakening of bargaining power—pure price competition is no longer sustainable.
Value Reconstruction: From Manufacturing Mindset to Brand Mindset
When reviewing the achievements of the 14th Five-Year Plan, Zhu Xiaohong, President of the China Home Textile Association, emphasized progress in technological standards and original design capabilities but also candidly noted the impact of the real estate downturn on the fabric industry. The 'six major development goals' she proposed—improving global diversified supply chains, tapping into domestic soft furnishing renewal demand, activating new quality productive forces through AI and industry-academia-research integration, building independent Chinese home textile aesthetics brands, implementing full-chain carbon footprint standards, and establishing healthy sleep laboratories—essentially outline a path from scale expansion to value growth.
This implies that enterprises need to redefine their roles: no longer just single fabric suppliers but service providers of integrated soft furnishing solutions. Lin Shaowu, brand consultant at Tianyu New Materials, proposed a product matrix of 'image products, profit products, and traffic products,' which is a concrete embodiment of this idea—building brand recognition through a tiered product structure to gain pricing power. For buyers, this means the selection criteria for suppliers will shift from 'lowest price' to 'highest comprehensive value,' including design capability, delivery stability, and functional innovation.
Technology Variables: How AI and Functional Fabrics Land
The technical sharing by Professor Ji Feng from Donghua University revealed specific pathways for university research to transform into industrial applications. Dye databases and AI color matching systems solve the color difference problem in digital printing, while fiber polarization image libraries combined with deep learning allow fabric composition testing to replace traditional chemical methods. Once these technologies are scaled, they will significantly reduce inspection and sampling costs for enterprises. More importantly, the process explanations for functional fabrics such as phase-change temperature control and nano-modification provide technical support for home textile products to shift from 'visual consumption' to 'functional consumption.'
Zhao Lu, Global VP of Collov AI, proposed the concept of 'spatial AI,' directly addressing the high costs of sampling and scene display in the fabric industry. Through world models enabling spatial analysis and material replacement, enterprises can save hundreds of thousands of yuan in real-scene shooting costs—an appealing proposition for SMEs. He judged that embodied intelligence will only be scalable in warehousing, sorting, and inspection processes within the next three years, meaning enterprises should not blindly pursue full automation but prioritize AI tools that can deliver quick results.
Global Market: Traffic Dividends and Industrial Belt Advantages
TikTok data shared by Modern Media revealed new opportunities for home textile exports: the platform covers over 150 countries with 2 billion monthly active users, and home furnishing categories in Southeast Asia and Latin America are growing fastest globally. For industrial belts like Keqiao, immersive short videos and origin live streaming can turn factory scenes into trust assets, which is more conversion-effective than pure advertising. However, going global is not simply a channel shift; cross-border stores need a three-tier product matrix of basic, functional, and co-branded products, which places higher demands on product planning capabilities.
From an industry perspective, the globalization of home textiles is extending from a track exclusive to leading enterprises to a growth channel for SMEs. Cross-border e-commerce platforms lower entry barriers, but competition intensifies accordingly. Only those enterprises that can quickly build localization capabilities while maintaining supply chain flexibility will have the chance to capture a share of the incremental market.
Practical Recommendations
For Buyers - Include suppliers' design capabilities and AI application levels in evaluation criteria, prioritizing partners who can offer integrated soft furnishing solutions - Pay attention to testing reports for functional fabrics (e.g., temperature control, antibacterial), avoid being misled by marketing concepts, and require third-party test data - Use AI virtual sampling tools to reduce sample costs and conduct small-scale market tests before bulk purchasing
For Foreign Trade Enterprises - Layout TikTok and other short-video platforms, build trust through origin live streaming from industrial belts, and focus on Southeast Asian and Latin American markets - Establish a three-tier product matrix of basic, functional, and co-branded products to avoid pure price competition - Collaborate with universities or research institutions to introduce AI color matching and fiber testing technologies, reducing sampling and quality inspection costs
As the industry shifts from scale expansion to value growth, decisions at every link are reshaping the competitive landscape. Keqiao's industrial belt advantages remain evident, but whether it can convert capacity advantages into brand and design advantages will determine the industry ranking over the next five years. For practitioners, now is the critical moment to re-evaluate positioning and embrace technological variables.