It's all to do with Meta Tags and your keywords.
You can pay for early submission to search engines but if you word/design your website effectively, you shouldn't need to spend money.
PM me if you want any more help/info.
Not true (sorry kiss).
Meta tags have not been a consideration of the major search engines for some years now. Keyword density is only a small factor for high ranking, valuable inbound links with appropriate terms essentially determine high ranking these days (along with age of site and level of "trust"). Some inbound links (eg some of those directories) can actually detract from the percieved value of a page.
PPC (pay per click) campaigns can and do achieve really good results.
Been (one of) my profession(s) for about 8 years now, feel free to PM any questions.
watching Steve and Kiss, all i can hear in my head is duelling banjos
Avoid search engine optimisation companies, or anyone who 'guarantees' to have you in the top 10 for a particular search. Everything they do is either simple common knowledge stuff or things that the search engine companies hate. Trying to trick your way into the rankings is a quick way to paying a lot of money to be blacklisted!
The search engine to concentrate on is Google. Try various searches that your customers might use, and make sure your pages include those words, preferably in close proximity. If you make widgets in inverness, don't have the word 'widget' on your home page, and your the word 'inverness' only on a contact details page. if widgets are price sensitive, make sure the word 'cheap' appers nearby, since 'cheap widgets inverness' is a likely search.
Look at the little bit of text that google pulls out of your page and shows on it's results page. If there's anything negative there, re-write it!
Search engines like lots of content (and so do potential customers!) - my business site went up the rankings when I wrote a few general 'hints and tips' articles and added them to the site.
Make sure your site is readable by search engines, if you use flash (especially for navigation) then the engine might not be able to see your content.
Lastly, think about the look and feel of your website. It may be that people are finding you, but deciding to go elsewhare because your website puts them off. A website should be there to give a potential customer a reason to contact you, not to boost your CEO's ego!