The following are a list  of questions you should ask a
Search Engine Optimization Company prior to doing business with them.

How often do you submit pages to the engines?
(if they submit pages repeatedly and often, don't hire them - excessive submissions is cause for some engines to downrank pages. You want a company that checks the ranking of each page for each keyword on each of the major engines first, and then only submits as appropriate.)

Do you guarantee rankings in the number one position on the engines?
(The answer to this one is tricky - anyone can get a number one position on one or more engines, for specific keywords (the specific keywords I am referring to are ones that are truly unique, and ones that virtually nobody would search for). However those keywords may not bring your target audience to your site. If you ask them if they will guarantee a number one position for a given keyword that you provide them initially, and they guarantee it, then they are not going to provide you with what you need. A good SEO company will tell you that they first determine what the best keywords are. There are SEO's that will guarantee you number one position listings. Personally I put them in the same category as that guy from Nigeria that keeps changing his email address, and promises me millions.) 

How do you determine what keywords to use?
(In the olden days determination of the best keywords was more or less of a brainstorming effort. Nowadays there is a statistical method of determining the keywords that will most benefit a given site. A good SEO company will already be using the current method, and be able to explain it in detail to you.)

 Do you do organic optimization or do you use PPC?
(Personally my company uses purely organic optimization, as it is less expensive for our clients, and often has better results. There may be successful PPC campaigns, but I do not know of any. I added this question simply because you should know what the company's philosphy is in this regard, and be aware ahead of time if you will be charged extra fees for PPC.) 

Does it matter what IP address my site is hosted on?
(Even if your site is hosted on a "good" IP, if it is in the same Class C address block with IP addresses that are blacklisted, it may impact the reputation of your site with the search engines.)

What are the specific things that have to be optimized, and what do you have to do to optimize them?
(If that question is asked as a general question about all sites, a good SEO will not give you an answer - for two reasons. The first one is that the things that have to be optimized vary from site to site, page to page, and the second one is that the things that need to be optimized vary with time, depending on the changes to the search engines' algorithms. So to give anyone a hard and fast list is misleading. On the other hand, if the question is asked about a specific page and/or a specific site, then a good SEO company will be able to profide you with the information. That being said, understand that it does take time to analyze a web page or web site, and the SEO should be paid for their time.) 

What about links to my site?
(You should not "buy" links to your site, and your SEO should not buy them. There are "link farms" that some site owners and some SEO's use for link-building. Building links in that manner is not ethical. If a site is providing good content and valuable information for site visitors, then you will find that in time other sites will add links to it automatically, because they want to provide their clients with ready access to the information. A good SEO company should talk to you about your associates/affiliates/site owners in businesses related to yours/etc. who might potentially provide links to your site. For example, if your company sells widget batteries, and you have a relationship with a company that sells widgets but no batteries for them, in order to provide your customers with what they need, it would be good to have a link.)

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