We always tell people to ask for deliverables to help establish clear services for dollars paid. We also encourage people to only work with companies that provide regular reports to detail tasks performed, an upcoming plan for the next month, an hour count and any new success you can see with search engines. This should include important numbers like the number of monthly visitors your website had and an increase in your search engine ranking for desirable keywords and phrases.
You should also balance your budget with expectations and needs. If you are a start-up perhaps you have a modest budget so you should work with a company that fits within that budget, yet can bring results to help you grow.
Lastly, base your decision off of the companies reviews and portfolio. There are some SEO companies that have dedicated themselves to one industry, for example, “dentists.” Although they may automatically seem like the best choice, you should read online reviews and show success for competitive keywords in your home state or similar city population.