I want to open a pizza place. I find an available space; a previous pizza place that went out of business. The only catch is that there are four other pizza places nearby, none of which is overcrowded, except at the peak of peak hours.
One–a block or two away, on another street–is the oldest and best: table service, other dishes, liquor license. The other three–two across the street, one up the block–all offer traditional and Sicilian slices and fountain and bottled sodas.
My store will offer regular and Sicilian slices, with fountain and bottled sodas.
When I use up all my capital and go out of business, is there any rational observer who would describe that as a “failure of the market”?