This thread so far consists of posts from people each of which have less than 10 posts to their credit, so I'm going to provide a good tip for the newbies in here:
Save your yellow pages phone books for at least the last one or two years. Whenever you get a new yellow pages phone book, only throw the 3 or 4 year old one out.
The reason why is this: No one starts his own business in any of the trades without learning all he can working for someone else first. They won't even start thinking about starting their own business until they're confident that they've learned all they can about the trade and have covered for their boss more than once when he was too sick or hung over to show up for work. But, starting your own business can be a pretty scary move. It means that you're giving up all your seniority with your old company for the chance at running your own company, and there are no promises the new company will fly. Anyone doing that isn't gonna gamble with that chance by charging as much as he can get away with, making a bad reputation for himself by doing patch jobs that only last the 1 year until his warrenty expires and leaving behind a trail of miffed customers who would like to really get that guy back somehow if they could. That's not how to start a company. Each of them is going to do exactly what you would do; be honest about telling the customer what needs to be done to fix the problem properly once and for all and charge a competitive rate for doing the work if you get the job. That way, if the fates don't smile on the new fledgling company, and it doesn't fly, at least the guy can honestly say he gave it his best shot.
But, how do you find these small fledgling companies where the owner of the company realizes it's only in his own best interest to do the best job he can at the best price he can? Easy. Compare the contractors listed in this year's yellow pages to those listed in last year's yellow pages. You'll know who went out of business, by comparing phone numbers you'll know who just changed their name, and you'll know who's new.
That's cuz if you were an experienced painter, plumber or Indian Chief, and you wanted to strike out on your own, the most important thing in your mind would be to ensure you get your new company's name in the yellow pages (maybe even with a 1/4 page add to ensure that people see you and you get your fair share of the available business). Without that, you haven't got a chance.
I've used this method to find reliable contractors many times and I've recommended this method to others on DIY Q&A forums like this one.
The other thing is that if you get a guy who does a good job for you at a reasonable price, take the time to buy a nice card and include a flattering 8X10 inch glossy of the work he did and include the phrase "please include my name in your list of satisfied customers" somewhere in your note. That way, he can post your card in a conspicuous spot in his place of business for others to see, and he'll know that card is worth it's weight in gold to the success of his company. Even if you never do business with the guy again, now you have someone knowledgeable in the trade that'll remember your name and will go out of their way to do a good job at a reasonable price for you the next time, and the time after that too.
And, truth be known, this entire post is all just common sense, but when most people have a backed up sewer, for example, the only thing they think of is that jingle with the "away go troubles down the drain" they always hear on the drive to work, and phone someone who's going to charge them twice as much because it's expensive to advertise on the radio. You can be smarter than that.
You can use this technology to find new carpet retailers too.