I'll try to answer your question, sorry if it doesn't satisfy you

Now, as far as i know the matter of Ottoman industrialization is quite a mess, and there are a lot of arguments and nuances that had been put forth, like Ülgener's Ottoman disindustrialization (the adoption of free trade in 1838 opened the Ottoman market to an influx of British factory goods, which destroyed the Ottoman manufacturing) and Pamuk's Ottoman de-industrialization (labour in the Ottoman Empire moved out from manufacturing to agriculture). My answer is focusing on the emphasis that the Ottoman industry, though couldn't reach the level that were their European counterpart, is by no means declined or stagnated, but rather experienced growth and remained fairly competitive in primarily domestic markets

Foreign observers and traveller's accounts (which in some ways shaped a lot of how we think of the Ottoman Empire even today) claimed that the Ottoman industry are 'doomed', 'failed', or 'backwards'. This was because their assumption was that big mechanized factories are essential for large-scale industrial production, and in the Ottoman case, there were few of it - outside of big cities like Istanbul and Salonica, there were few mechanized factories. This, however does not meant that the Ottoman industrial scene stagnated or declined, but rather experiencing growth. Though manufacturing was done mostly with artisanal methods, and performed in households or workshops rather than mechanized factories, the number of domestic manufacturers and workshops overall increased and had their output increased because of imported cost-cutting technologies, low wages, and new markets pushed by the free trade. For an example of this, in Arapgir, imported British cotton yarn replaced local hand spinning, freeing the same labor for more profitable work in hand weaving, creating a new industry that occupied several thousand households and lasted for the rest of the century.

This was seen in may parts of the Empire, as domestic manufacturers was faced with realities of a new era, they adjusted accordingly. The silk weaving and cotton spinning of Bursa was facing difficulties, and consequently many silk weavers switched to weaving cotton with British yarn or replacing silk weaving with silk reeling. At the same time, increasing European demands for silk because of the rise of the middle-class and contemporary epidemic among silkworms led to soaring demands for Ottoman raw silk exports. Bursa non-Muslim and Muslim entrepreneurs established workshops where workers, mostly girls and young women reeled and twisted raw silk. From being a producer of silk cloth, the region was thus reduced to supplying largely semi-finished inputs to French manufacturers until the First World War.

Between 1840 and 1877, Bulgarian textile industry grew because of both internal and external demands. Far from being unable to compete, Bulgarian woolens were so competitive that "European goods were largely restricted to the fashion trade". The volume of Bulgarian woolens brought to Uzundzhovo fair rose between 1857 and 1869 from 1.03 million piastres to 4.7 million, with their costumers were mostly from Anatolia and the Levant. The modernization of Ottoman institutions during the Tanzimat and access to the empire's large internal market is responsible for Bulgaria's growth in this era as Bulgaria, regressed economically after independence

Macedonia was another Balkan region which had a flourishing textile industry. Véroia were especially noted for spinning and weaving towel and shirts of linen for Balkan and Levantine markets and dyed cotton yarn for Central European markets. In the late 1850s, Véroia, Salonica and Edhessa exported 574,000 francs worth of cotton towelling, mainly to Levantine markets. The suburbs of Salonica produced 4.2 million francs worth of textile, while the textile centres of Pella produced 1.7 million francs worth of woollen cloth, which were exported throughout the Balkans. Further south, Litochoron and Livadia specialized in woolen skirts, exporting 1.2 million francs into maritime Mediterranean markets.

Ottoman carpet industry from East Anatolia and the Levant also experienced growth. Between the 1870s and 1890s, exports nearly doubled in value, rising from 17 to 32 million kuruş in value. This was caused by overall production increase as chemical dyes replaced natural dyes, production moved from houses to workshops, and imported sewing machines were started to be used. Exports from the city of Alexandretta for example, increased from 235 tons, worth 113,000 pounds in 1889, to 649 tons, valued at 285,000 pounds in 1907.

Moving away from workshops to factories, even with their small numbers, they are also an important marks of Ottoman industrial growth during this time. The number of privately owned factories increased after 1870 as the government adopted many stimulative policies, primarily tax exemptions. Cities like Salonika, Sliven, Izmit and Istanbul possessed several factories, producing goods from cigarettes, textiles, distilled spirits, soap, bricks, nails, and tile. Arguably one of the biggest and most influential of this was the Régie des tabacs, a company which holds the monopoly over purchase and sale of Ottoman tobacco, the profit of which were divided between the OPDA, shareholders, and the Ottoman government. Its poor working conditions and anti-labour laws in the early 20th century amongst other factors turned Salonica into a center of labour and socialist activism in the Ottoman Empire. (See here for my writing on women in Regie factory)

Recommended Readings:

An Economic and Social History of the Ottoman Empire, 1300–1914 by Halil Inalcik and Donald Quataert still has a good and comprehensive look at Ottoman economy, especially manufacturing and trade in the later eras.

Artisans of the Empire by Suraiya Faroqhi is a good analysis of Ottoman artisans and manufacturers from the 16th to the 20th Century. It also includes the social and economic aspects of artisanry and manufacturers in the age of industrial revolution

Ottoman Manufacturing in the Age of the Industrial Revolution by Donald Quataert is my main source, he details how Ottoman manufacturers survived the industrial revolution by adapting to new realities and took advantage of new markets and technologies.

The Balkan Economies, 1800-1914 has a sober look on the economy of Balkan regions during Ottoman times and its economic growth in the 18th and 19th century

Turkey, Islam, Nationalism, and Modernity is a good general history of the late Ottoman Empire and early Turkish Republic, and it especially contained a comprehensive summary of Faroqhi's and Quataert's argument regarding Ottoman manufacturing and industry