A growing number of independent retailers admit they are turning to unscrupulous suppliers of alcohol in order to remain competitive.

Dealers trading out of white vans are visiting stores across the country, offering products at a fraction of the price demanded by wholesalers.

One East of England retailer, who wished to remain anonymous, said he was forced to buy from these "fly by night wholesalers" in order to compete with other stores who had also bought through 'grey market' routes.

"Special Brew is currently more than £28 at Booker, but you can buy it for under £20 from these 'wholesalers'," he said. "Not only do you get these prices but they deliver for free."

The best deals, he added, could only be secured by paying in cash, something which he had so far refused to do.

Another independent retailer from the West of England said it was difficult not to get swept up in the vicious circle.

"Desperate times call for desperate measures and I understand how retailers struggling to keep their heads above water can get sucked into things like this," he said.

Federation of Wholesale Distributors director general John Murphy said the problem had escalated over the past 12 months.

"I sympathise with retailers who are struggling in the current economic climate, but they should not be tempted by these offers, no matter how desperate they are. In the eyes of the law, retailers would be found just as guilty as the duty fraudsters."