The answer is the Internet.
Full service wholesalers are intermediaries that provide a range of services to retailers, such as storage, delivery, and credit. While they play a role in the supply chain, they are not the primary source of competition for brick and mortar retailers.
The Internet has significantly transformed the retail landscape by enabling e-commerce. Online retailers can offer a wider selection of products, often at lower prices, and provide the convenience of shopping from home. This has created substantial competition for traditional brick and mortar stores, which must adapt to remain competitive.
While the economy can impact consumer spending and retail performance, it is not a direct competitor. Economic conditions affect all retailers, both online and offline, rather than creating a competitive dynamic specific to brick and mortar stores.
The government sets regulations and policies that affect retail operations, but it is not a competitor. Government actions can influence the business environment, but they do not directly compete with retailers.