In short: maybe.
I think you have to approach it as a most effort <—-> most results sort of paradigm. Cleaning up the top 20 directories versus every single little podunk directory is probably not very different in terms of search engine local rank, but very different in terms of effort, as in: some effort versus gargantuan.
Which do you want to do? Given that you are charging by location (you are, aren’t you?) wouldn’t you rather be sipping mai tai’s on the beach on the client’s dime versus calling up Joe-Bob’s directory du jour to see if they have updated the address and phone number of your client? Or spend money with one of the several local search directory providers, with no proof from them that they accomplished…anything? Why not just do Yext and be done with it?
I’m probably pissing off the local SEO guys by saying this, but saying that you send the client’s correct contact information to 500 (or 5,000) directories is not the same as correcting 500 directories. You’re just the freaking middle man. Places like Yext actually deliver. BTW, I am not paid by Yext, I just have seen their results, and man, are they impressive. They have actual business relationships with top-tier directories, and the corrections they make are nearly immediate.
Sure, send your money to the directory submission companies and…and what? You didn’t actually expect reporting, did you? Actual proof that they did anything at all? How about affecting rank of local terms? Nothing? Pay & pray, pay & pray.
Sure, if the company actually provided a service, like create local landing pages, with goodies that the SEs like, like maps and directions and schema correct addresses, then it might be worth something. But what? What is that value? And if you have more than, say 100 locations, why the heck are you paying someone to do that for you? Don’t you have the know how to be able to do this relatively simple task yourself? Why pay a company per location on a yearly basis for creating pages that do not get updated that often anyway?
There’s a lot of mumbo jumbo in local search, a lot of, in my mind, irrelevant complexity that serves the function of separating the client from their money, but as far as providing actual value I think that is debatable.