Competitors are rivals or contenders for the same thing. Two boxers in a ring are competitors, and so are restaurants located on the same block.
When people compete (in sports, business, or elsewhere), they're trying to achieve the same goal and are therefore considered competitors. Two teams in the same sports division are competitors. Two politicians running for the same office are competitors. And even two guys courting the same gal are considered competitors. Competitors are out to win.