Nobody has suggested this, so I shall.
Get a copy of Internet Business Promoter (IBP) from Axandra.com as this is what this company is probably using to create reports and do submissions. You can try it free.
It's not cheap, but when you are familiar with the way it works, you can sell your friend SEO services and charge him what the other company is charging - or you can save him money.
In any event, this package will teach you more about SEO in less time than any other method and without the hype associated with the competing products.
Beware of directory submissions - low quality directories can get a site penalised.
As others have said, if the keywords/phrases aren't that competitive, then it's best to do this stuff yourself anyway. It's not hard to get top 3 positions, especially if there's a local element to your services.
Content is the most important aspect - if the content is good and people are looking for it, then it probably will get found.
Bad content with good SEO is a waste of time and money.
Personally, I've never yet seen a service worth paying the kind of money you've mentioned, but I've seen plenty of disappointed people who've fallen for it.
Good luck.