http://www.aaa3.net/how-to-scale-sketchup/

How to appropriatly scale in google sketchup 7?
I’m trying to make a floor plan of a house I am a new user and i realized that trying to make the house in its actual size (i.e 1000 ft length walls) was way to hard, how can i efficeintly scale this down so that i can work with what im doing AND get a realistic idea of what my house will look like
You should build with regular measurements, ie Feet or yards. When you open the program it should ask you to pick a scale. The little man standing at the intersection of the planes will give you a basic idea of scale. Use the tape measure tool to check.
The google tutorials help too: http://sketchup.google.com/support/bin/answer.py?hl=en&answer=36232
Google SketchUp Toolbar Series: Scale