Marketing Comet has a good post on competition. Your new small business may not have any direct competition (people who do exactly what you do and tap into your pool of potential customers) but it may have indirect competition.
Here’s the money quote from the Comet:
“Your real competition consists of all the other likely choices that your customers can make. One of those choices is nothing at all. I may really need an oil change, but decide it's too much trouble or too expensive. I may be hungry and yet decide not to eat.”
This is something that small business owners often overlook – at their own peril.