Always ask the client first before blindly applying any form of logic.
Even if it seems easy to identify who and where a client’s competition is, it’s very important to ask early on who and what the client considers to be the primary competition. Running their business day in and day out, they might often perceive competition of forms you wouldn’t objectively consider.
A business that relies on highway traffic, for instance, may be in competition with patterns or tendencies having shifted due to a long-term construction project that makes access less convenient, even though it’s 2 miles away, and you’d never equate it during a routine visit.
Another example might be when a nearby business that wouldn’t technically compete at the product level is hogging the time and attention of prospective customers on foot, or worse, motivating them in some way to shorten their visit to the neighborhood. I’ve seen this more times than I would have ever expected.
The first time I sit down with a client, it’s to get the “life story” of their business; all their successes, all their gripes. Often, the hooks and trapdoors that come out of it are invaluable to effective marketing strategy.