When I was a kid, I remember my store manager (one of the franchise owners) mentioning how much research went into a new location for McDonalds. The sheer amount of research, planning, etc. And he (probably jokingly) said that Burger King would just look for where McDonalds was building, and go across the street :)
He may have been "half joking", but that is indeed done, and it's why you often see clusters of fast food (or coffee shops, or whatever) businesses together. The basic idea is that one company did a bunch of research and determined the site was good. The next company comes along, and says "Hey, Brand A is here, so we should probably be here as well". They'll preform their own market research and due diligence regarding the site of course, but the existence of other brands there drives up the idea that the site is good location.
Furthermore, these business clusters serve to actually drive up business far all the brands located there, despite them being competitors and for the most past interchangeable with each other, as you gain a larger share of customer traffic to an area with many businesses.
Lastly, my current company is majority owned by one of the early investors and owners of Hollywood video. He said that Hollywood and Blockbuster would engage in the same practice of locating physically close to a competitor's store, because that area would have good customer demographics.
Its a pretty interesting topic, really..