What term describes a situation where multiple businesses compete for the same customers?

The correct term that describes a situation where multiple businesses compete for the same customers is competition. This concept refers to the rivalry among businesses in the same industry where they strive to attract the same consumer base. Through competition, companies may engage in various strategies such as pricing, marketing, and product differentiation to capture market share and encourage consumer choice.

In contrast, collaboration refers to efforts where businesses work together towards common goals rather than competing. Cooperation also implies a working together, often for mutual benefit, which negates the aspect of vying for individual customers. Consolidation involves the merging of businesses, which reduces competition rather than emphasizing it. Thus, in a market context, when multiple firms are trying to win over the same customers, they are indeed in a state of competition.