Why do competitors open store next to each other?

If you have been to a shopping mart or a shopping mall you will find that stores of same product are located nearby or next to each other. Have you ever wondered why is it so? By locating stores next to each other they are just increasing their competition as the consumer has more options at the same place. If I have an option to eat pizza at Dominoes or at Pizza Hut in the same place then I will chose one which means loss of sale for one of the stores. But then also stores open next to each other. Why not just divide area and do business in that particular area just like mafia people do? Just look at the video and you will understand the whole concept:

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Source: Ted Ed

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Harsh

Harsh is a curious writer who loves to explore his surroundings. There are many websites who provide answer to people queries but no single website alone resolves the curiosity of people. Curious Mind Box is an initiative to resolve the curiosities and answer every What, How and Why question that comes into your mind.

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