Legal Question in Business Law in California

Not unless it is prohibited by the landlord's rquirements in the lease, or unless it violates any city code requirements.

Only if the business has a contractual duty not to operate next door to you, or if its landlord has a contractual duty not to lease that space to your competitors. Such clauses are common in shopping center and mall leases, but relatively uncommon elsewhere -- especially where the spaces belong to different landlords.

Both prior answers should be helpful. I would also add that if one or both businesses are franchisees within franchise operations, there may be franchise contractual applicable issues impacting the rights.

The right to be free of a nearby competitor arises most often in a shopping center or similar setup where multiple retail spaces are under the control of a single landlord. Shopping center leases often contain clauses protecting a tenant from the landlord's allowing a competitor. For example, a shopping center may allow only one frozen yougurt shop, or only one cell phone dealer. Otherwise, California law and policy encourages competition. Ever see a busy intersection with two, maybe three, gas stations?

Try selling better quality products and/or lowering your prices.