Initial layout design - How do you do it?

I’m just about to start building a website for a client (first paying one woohooo!)

I am wondering how you guys go about starting an initial layout design?

-Do you grab a pen and paper, maybe a couple of coloured pencils?
-Do you do it in Photoshop and port it over?
-Do you do it straight into flash and then work on the graphics later?
-Do you look at other sites?
-Do you delve into a couple of design books?

Anyway, tell me how you get to your initial concept… I’m listening…