Skype has a number of microphone controls it implements, but sometimes these controls can work against the user and produce lower quality calls. If you find that your microphone is too low in volume for others to hear easily, adjusting a number of settings can help alleviate the problem.
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Check to see if your microphone is muted. Be sure to check the microphone itself too; very often microphones have a mute button that operates independently of anything else.
Click the "Tools" menu and select "Options." Now select "Audio settings." Make sure that the correct microphone is selected here and that "Automatically adjust microphone settings" is unchecked. This will prevent Skype from changing the volume at which the microphone receives your voice. You can then use the slider to manually adjust your settings.
Check to see if the microphone is plugged all the way into its socket. Partially plugged-in microphones and headphones can still work, although they might not work at well as they could. If the microphone is plugged in correctly, try swapping it out for another one to rule out the possibility of faulty equipment.
The problem may not be on your end. You may sound quiet to a contact because his settings could be at fault. If you've checked everything on your end, but nothing seems to work, have your contact turn up the volume and check settings on his end. Skype might be adjusting your contact's speakers automatically; have him deselect the option "Automatically adjust speaker settings" in "Audio settings."