I'm not sure of the size of the house but the price sounds way out of line to me. What is the size and let me bid it before you pay that much. Sears just uses subcontractors who come and go depending upon whether they are in jail or drug rehab, etc. I know crews that go state to state and it only takes 2 or 3 people about 2 or 3 days depending on what time they show up and how hungover they are. They may get about $10 an hour plus travel expenses so you go figure where the profit is going when the vinyl is about $40 a square. I am not sure if that includes the backer board which isn't very expensive.
LJ has some good ideas. There are different types, thicknesses, color depth, etc. You definitely want the windows wrapped and may as well get the soffits and fascia done. I have seen some people that side around protrusions such as electrical boxes, etc. instead of under them. The more places they notch around with the siding, the more places that can leak rain water, etc. and then you have hidden rot problems that you can't see until it is too late. I would want a job that looks like the house was built with vinyl instead of one that is covered over.
A 1600 sq.ft. one-story ranch would probably run about 20 squares +or- (with gables) and then assuming costs of approximately $50 a square, I get material cost of about $1000. Add another $1000 for labor. Add another $500 for miscellaneous items. I may be ready for a road trip to Maryland based upon what sears is charging.