Greater Camouflage Dye does not make you invisible
You are probably being too generous with the effects of Greater Camouflage Dye. It doesn't make you invisible - it just allows you the opportunity to make a Hide/Sneak check when you otherwise wouldn't.
Invisibility says:
Illusions bend light around the target, rendering it invisible. This makes it undetected to all creatures, though the creatures can attempt to find the target, making it hidden to them instead. If the target uses a hostile action, the spell ends after that hostile action is completed.
Invisibility explicitly makes you undetected to all creatures. Contrast this with Greater Camouflage Dye which merely says:
The target can Hide or Sneak without cover or concealment for 10 minutes. If the target uses a hostile action or moves at more than half its Speed, after that action is completed, the effects of camouflage powder end and the creature ceases to be hidden or undetected.
You aren't invisible. You can just attempt to Hide or Sneak, without requiring anything to hide behind.
The player requires multiple actions to make use of this.
You might be too generous with the action economy also. You noted they need to use 1 action to activate Greater Camouflage Dye. At that point the character is standing out in the open completely observed by everyone.
They then need to spend one action to attempt to hide (which requires a stealth check). If they wish to move and remain hidden, they need another stealth check for the Sneak action - which only allows movement at half speed.
Attacking makes you detected.
In a comment you mention that your alchemist uses Greater Camouflage Dye then bombs opponents. Although the Dye stays in effect with a hostile action, the character still needs to use more actions to hide/sneak again.
To keep up with this tactic the character would spend an entire turn throwing a bomb, re-rolling stealth to hide, than stealth again to move.