The above tool will check a websites backlinks / inbound links. Use the 2nd and 3rd URL options to see how your site compares with your competitors.

Backlink / Inbound Links
Backlinks are incoming links to a website or web page. The number of backlinks is an indication of the popularity or importance of that website or page. In basic link terminology, a backlink is any link received by a web node (web page, directory, website, or top level domain) from another web node. Backlinks are also called as incoming links, inbound links, inlinks, and inward links.

To achieve good natural listings building quality backlinks is essential to improve Google PageRank and improve the placement of your website within search engine listings.

It is a common misconception to think that it is the amount of links pointing to your site that counts but it's not only quantity it's quality. Incoming links will never hurt your your site because you can't control who links to you, but links from popular well listed sites will have more impact on your website.

Reciprocal / Outbound Links
When linking to another website it is important to remember you are endorsing that website and directing website traffic in its direction this is an outbound link. You may be familiar with emails with requests to link to other websites that will link to your website in return, this is called a "reciprocal link".

These outbound links and reciprocal links are viewed by the search engines that "consider" the relevance of these other websites to your website when determining PageRank and search engine placement. By linking to link farms or unrelated websites you can damage your own websites profile with search engines.