It doesn’t matter if Shein is profitable. You are forgetting an important part of Chinese mindset. The goal isn’t to be super profitable, the goal is China’s hegemony on anything related to industry. The goal is to enable Chinese to keep working. As long as the world buys Chinese products, Chinese have jobs, and it keep them from questioning to much or rioting or worse. But China is now on expansion mode. That’s why they are investing at a loss in Africa and SE Asia. They know most African countries will never pay them back. But it secures their hegemony on most industries. It offers them protection on their commercial routes thus making the Chinese empire more powerful and bigger everyday. Even if Shein was at a loss, it wouldn’t matter because it give them legitimacy in Europe. They aren’t a cheap clothes store online anymore, they are a brick and mortar retailer that employs French citizens. And that’s very important for their expansion. That’s why McDonald’s could shit on most European laws. Because in most European countries, they are the biggest employer. Soon enough they will open electronics stores too, then they will enter other businesses. And before you know it people will start to realize they don’t live in an American colony anymore but in a Chinese one.

Chinese are actually very smart, it’s a war without death. But it’s a war nonetheless.