Threat of substitutes

Sir,

in the May17 MCS variant 3 there is a question about the threat of substitutes.

It is about a pound shop style business and the suggested answer keeps on saying how there is a threat of substitutes as the products are generic and there are virtually identical products available on the market for similar prices.

Now, the thing is that I always thought substitutes were products that serve the same need but in a different way.

So for a $1 can of baked bean another $1.05 can of baked bean of a different brand is not a substitute but a competitor.
A substitute for canned food would be a meal out in a restaurant, maybe.

What do you think?