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Most categories have a maximum of 3 vendors. Some categories have 2. Some categories have 1. Jewellery has 4-6. All vendors have to be different from each other. So, if you're in the same category as someone else, your items have to be significantly different from the other person's.
Material is not a factor. 5 people can be using the same material but producing different things. For example, 5 people use yarn. One knits baby booties. One knits scarves and hats. One crochets dish cloths and towels. One crochets placemats. The 5th one knits and crochets ponchos. Those are 5 different categories. Even if they were all placed in a row, they wouldn't be competing in the same categories.