In programs written in C, command line argument parsing has always been done using the getopt(3) library function. This function has set the standards Linux/Unix users have come to expect from command line interfaces. Fortunately, there's a getopt(3) equivalent for almost every programming language and the shell is no exception.

The getopts command available in all POSIX-compliant Bourne shell derivates (like bash, dash, or ksh) provides convenient command line parsing capabilities. It is a builtin accepting POSIX-style argument lists (as opposed to GNU-style, which is a bit more fancy) and should not be confused with the getopt utility.

For my shell scripts, I use the following template to implement command line parsing:

#! /bin/sh

USAGE="Usage: `basename $0` [-hv] [-o arg] args"

# Parse command line options.
while getopts hvo: OPT; do
    case "$OPT" in
        h)
            echo $USAGE
            exit 0
            ;;
        v)
            echo "`basename $0` version 0.1"
            exit 0
            ;;
        o)
            OUTPUT_FILE=$OPTARG
            ;;
        \?)
            # getopts issues an error message
            echo $USAGE >&2
            exit 1
            ;;
    esac
done

# Remove the switches we parsed above.
shift `expr $OPTIND - 1`

# We want at least one non-option argument.
# Remove this block if you don't need it.
if [ $# -eq 0 ]; then
    echo $USAGE >&2
    exit 1
fi

# Access additional arguments as usual through
# variables $@, $*, $1, $2, etc. or using this loop:
for PARAM; do
    echo $PARAM
done

# EOF

It is easy to add more command line switches. If you want to add an -x switch requiring an argument (-x arg) and a y flag without an argument, you would have to change the getopts call to getopts hvo:x:y OPT and add two case labels to the loop. Note that the colon indicates that an argument is required for a flag.