localized search important

Yes Google is going more towards localized searches

But what if you have a site that is a nation site and not local, how can this site beat the local seaches when your target market in all the of US?

To better answer your question, do you mean keywords involving a city, such as "league city web design" and results for that city show up, or do you mean when you search for, say, "florist," Google lists 1-2 national sites, the Places results, then the other 8-9 national sites?

well for example if you run a store for tshirts but your target market is the entire US

how do u set up better seo when google will perfer local tshhirt stores in the city you are in

is the best wat to create subdomain site for every city?