There are lots of candy companies, do we need a new candy company? Yes, if the market demands it!
If you see something that a company is not utilizing to it's fullest potential, and you can deliver it at a price that people will purchase, then there's no reason NOT to start the company/product.
Keep in mind, depending on the business, you don't necessarily have to make money initially - but that'll be determined on how big of a floating fund you have (personal, bank or investor) and how long before your ROI.
At the end of the day, you shouldn't let competition be the reason you don't start - unless of course you don't believe you can be as good, or better than them. In that case, yes, forget about it.