<![CDATA[Sidemen Endek fabric is highly valued in international markets and has been showcased on global stages such as by Christian Dior. However, the industry faces critical challenges, including declining competitiveness, limited capital, raw material shortages, and a lack of young labor force. The COVID-19 pandemic further exacerbated these issues. Nevertheless, several SMEs such as Pelangi Traditional Weaving and other home industries have continued to innovate and preserve this cultural heritage. This study aims to explore the development potential of Endek weaving SMEs in Sidemen to sustain the industry and foster the preservation of local culture in Karangasem. A quantitative associative approach with a causal relationship was employed. Data were collected through observation, structured and in-depth interviews, and questionnaires. The analysis technique used was multiple linear regression based on the Cobb-Douglas production function model. The research population comprised 294 Endek weavers across 15 weaving business groups. The findings reveal that capital, labor, and raw materials simultaneously have a significant influence on Endek fabric production. Individually, each of these variables also has a positive effect on production output. The analysis of economies of scale indicates that the weavers are operating under increasing returns to scale, meaning that increases in input factors result in proportionally greater increases in output. The efficiency of input utilization was found to be optimal, though it can still be improved through more effective production strategies. The study concludes that optimizing production factors is crucial for enhancing the competitiveness of the Endek fabric industry.]]>
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