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First of all there are two ways to use Vlookup, Either with exact match or range match.
Range match is best used with the example of grading eg A=91-100%, B=81 -90% etc. If used properly there is not much issue.
The major issue arises in exact Match. Here the spellings have to be exactly correct. For example If one cell says " John" and the other says "John", it will not consider them the same. This is ideal in cases of database extracted sheets but not where data has been hand punched. The data has to be properly screened before applying Vlookup.
In fact all formulas have their limitiations. This is where experience comes in. With time one can learn to how combine three or four formulae to compensate for any limitations