Help SMB owner understand my rank vs competitor

[crosjn]

I know just enough to get myself in trouble.  I rank pretty well (mostly concerned about Places/Local Google SEO.)  But my neighbor and nemesis outranks me consistently.  What I can't understand is that his links, keywords, etc all seem to be dominated by junk pharmacy links.  We run upholstery shops.  Can someone explain what's going on?

My site : www.markhamco.com
His site : www.mandmupholstery.com

Search I care about "Upholstery Dallas".  If I search from Google maps, I outrank him.  If I just go to Google.com and use "Upholstery Dallas" then it appears he wins.  But why?

Many many thanks
Jeff

[crosjn]

Thank you for the tips.  I have certainly tried.  What I'm really asking is - is there a strategy I don't understand with the keywords/links behind junk pharmacy ads (cialis, viаgria, etc.)?  Users don't see them on the page but when I run SEO analysis tools, they show up.  I'm assuming these are hidden links & content used in some (I guess) black-hat SEO scheme?