Non-R&D-based innovation and the growth of SMEs in China: A case study of Hangzhou FC company

Recently, a growing number of academic research shows that this R&D-focused view of innovation ignores the other popular innovation activities in SM Es, which cannot explain that some SMEs with weak R&D capability still be innovative. Further, relevant studies have indicated that absorptive capacity is closely related to the degree of benefit SMEs can get from non-R&D-based innovation. Non-R&D-based innovation provides newly innovative ideas for the enterprise, while absorptive capacity helps enterprises to adapt to the diverse actual situations, which further improves the innovation performance. Therefore, this paper is trying to reveal the pervasive non-R&D-based innovation practices in Chinese SMEs basing on a case study of Fashion in China (FC in short). It shows that non-R&D-based innovation activities, namely technology adoption, imitation and reverse engineering, design, innovative implication of existing knowledge, etc., have positive effects on innovative performance, and the enterprise's absorptive capacity also has a positive moderating effect on the relationship between non-R&D-based innovation activities and innovation performance. This research argues that, non-R&D-based innovation activities are very effective and popular for SMEs' survival and growth and the continuous investment in absorptive capacity can help to further enhance the effects of non-R&D-based innovation.