Competition is good for consumers, that's why we want to encourage it. If your business model is undermined by people understanding it, you've got a problem anyway.
One reason for this is that people make choices to beat their competition rather than to provide for their customers. Often short term thinking leads to quality losses in order to capture market share and sometimes the competition devolves into direct sabotage of competitors. This intense competition can result in higher costs for consumers as it becomes more difficult to bring products to market.
Even without that, you can have price competition which, while theoretically leading to a low cost for consumer in the short term, can price out high quality goods in a price conscious market.
Flooding the market with cheap, low quality goods can lead to overall quality drop and a decrease in investment in the area. Even though consumers prioritize cost over quality when given the option in some markets, it doesn't necessarily mean they are making the correct decision.
On the whole, yes, but not for all consumers.
If some people lived near a beautiful meadow and river, and everyone else lived in the desert, then competition (e.g. opening up a direct train to the meadow) would hurt the ones living in the meadow.