Personally I feel that additional traffic gained from linking to competitors outweighs potential chance of losing business to them.

Before you start your linking campaign here are a few tips to help you:

(1)Ensure that there is a visible link to "Links" directory on index page of site you are requesting link from and that links directory is organised. It's unlikely that your link will be found by visitors if it is one of 100 links on an unorganised links page.

(2) Follow above rules for your own website - it's only fair.

(3) Once you have found a page it is good manners to add a link to your own site before requesting a link from another. This way webmaster of that site will know that you are serious and will be more likely to link back to your site.

(4) Being highly organised whilst requesting links is also important. Using link management software to keep track of all your link requests and automatically add them to your web page literally halves time taken to request and manage links.

(5) Keep track of all links you have requested, either through link management software or in a spreadsheet. Add URL, date requested and contact information for all links you have requested and update this everytime a link is approved or declined. This will help you to keep track of your reciprocal linking campaign and prevent you from looking stupid by requesting a link from same site multiple times.

(6) Use tools to help you decide which sites to link to and to help monitor your own progress. Tools that I use include

- Alexa Toolbar - http://www.alexa.com/ - Google Toolbar - http://toolbar.google.com/ - Link Popularity tool - http://www.marketleap.com/publinkpop

Finally, set yourself a goal to request a specific number of links per week or per month. Keep going until you meet this target. It may be boring, but once you get into way of doing this, it will seem like second nature and you will start to reap benefits in form of increased traffic to your website!