Do not be honest about not having any experience, no one wants to pay you to learn while experimenting with their website.
The best way to start out is to team up with a more experienced seo services provider.
That way you can "borrow" their credentials while you are starting out.
You can show their work, use their pricing (mark it up, obviously) and of course, use their services (since you really don't have the experience). You loose a little margin, but you gain a lot in return and you free up time for sales.
The standard line for credentials is "My clients prefer to remain anonymous, so I can not reveal specific domain names. However, I can tell you I have worked with over 100 websites to get first page rankings for competitive terms like 'California Dentist'. I am sure I can do the same for you."
That's enough for 99% of potential clients.
BTW, my plan is to not charge him for SEO until he see's results.
That is a serious mistake. 1. He will prefer to get results instead of a discount, and if you don't charge it's going to be harder for you to invest in services. 2. It might take longer than you think, and 3. (MOST IMPORTANT) define "results" - you might get him to first place for a term that ends up not converting for him - he's not going to see the value.
...or he might decide that he got to the first page because of his own efforts not yours, or he may simply disappear once you get him ranked.... etc,etc,etc
Also, to be honest, it simply looks more serious if you charge him.
Offering a discount for no reason says:
"I don't believe that what I am doing is worth what I am charging"
doing it for free says: "it is worth nothing"
2) Since your references suck, give him a full outline of what you'll do for him. I don't mean to go into what you'll technically do, but in very nice marketing terms create a full proposal. My proposal was like, 9 pages long. It impressed my client. Format it very professionally. Google around for examples to copy if you don't have any idea right now.
3) Tell him that you can tailor your work as per his budget, and get him to tell you his budget. That way you don't have to worry about overcharging/undercharging.
-100% agree
Be sure to identify what you can do for him, but do NOT give out your complete plan and do NOT give him the list of keywords you will rank him for before he has paid. You do NOT want to go into details about the way you build links or how backlinks work. -If he knows a little seo, he no longer needs you, if he knows nothing you are only confusing him.
THIS is what the potential client wants to hear:
I can get you an additional 1000 potential customers to your website per month.
I can improve the quality of the visitors to your website, improving your conversions (do this by targeting buy-trigger keywords)
I can give you an onsite analysis that will improve conversions
I can provide ROI <- guess what? THAT is the one they MOST care about. Are you going to earn them more than you cost them.
Make sure you do the research to back up those claims though, don't throw out numbers that aren't there and calculate traffic from spots on the first page, but not #1.