Under the counter deals, 'chop-chop' and arson attacks: Inside Victoria's illegal tobacco market

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Police are stepping up their efforts to tackle the illegal tobacco market, after a string of arson attacks against shops in Victoria.

It's the middle of the afternoon in an independent grocery store in Melbourne's outer suburbs and Nick* is standing behind the counter.

"He was selling some tobacco to help the business for some money, but the police now check all the shops so we can't sell anymore," he says. Detectives suspect a large portion of the tobacco industry has been infiltrated by serious and organised crime and believe there are more than 800 stores across Victoria selling illegal tobacco.The investigations into the tit-for-tat fire bombings have resulted in hundreds of thousands of illegal cigarettes being seized by police and Australian Border Force.

"Sometimes there's a fear that I'm going to come to work and we're not going to have a shop," Emily says. "These guys are getting these at whatever price and selling them for $20 bucks, how does anybody compete? How can you compete with that?" he says. The measure, implemented to reduce smoking rates across the country, has seen prices for tobacco skyrocket.

Theo Foukkare, chief executive of the Australian Association of Convenience Stores , wants to see the state government step in as the main enforcer in a similar manner to liquor licensing.

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