Turn on the stereo and put the volume to medium high. Walk throughout the room and see where the best sound is going. This will create a better understanding of how the sound bounces off the walls in this room.
Move furniture around. For a large, empty room that may produce an echo, hang curtains, place throw rugs near the speakers if there are separate ones on the ground and put large pillows on the couch--anything to help absorb some of the sound and cancel out the echo. For a smaller, more cramped room, do just the opposite: Place minimal furniture in the room and remove carpets and heavy curtains.
Place the stereo system against a wall with the speakers facing the room to project as much sound as possible.
Set the room up for an enjoyable listening experience. If this experience will be in a party setting, put extra chairs in the room for guests to sit. Hang a few pictures on the walls and have tables set up for food or drink. If this room is for a more relaxing, one-on-one experience, put a large armchair in the room with a small side table next to it. This will enable relaxation with a place to set a drink, food or a book for light reading.