In a post entitled Does Your Business Qualify for Local SEO?, Cre8asite forum member SEOigloo poses the question about whether your business website can take advantage of local SEO. Here's what's necessary:
If the business serves only within a fixed geographic region, Local SEO is a no-brainer for you. You need to optimize the tags, footer, on-page copy for that magic combination of product/service + location, and you need to register your business with the various local business centers and IYPs.
What are the pluses? Beyond regular optimization, she says that "Local SEO can be used as a form of keyword expansion that will get you ranking for additional terms that do relate to your business."
It's also helpful to take advantage of getting your business listed in Google Maps. Sometimes this isn't entirely possible, like when your business doesn't have a physical address, but it should also give you a traffic boost if you do.
Forum discussion continues at Cre8asite Forums.