We wrote an article about this(check out our tips section on this page) but in a nutshell: check their experience by asking for references of current clients, know that price is connected to experience, so cheap SEO is often of low value. Ensure you are provided data from the agency, in terms of their market research for your business, and ensure that the agency is KPI driven and will stick to increasing not just your ranking, but generating more leads to your business.