Business owner's guide to cutting travel costs

David Ulevitch, CEO of Open DNS, a networking services start-up, stays at a friend's house when he travels on business from San Francisco to New York City.

And he urges his 10 employees to do the same while traveling for work.

"I never tell people they can't stay at a hotel," says Ulevitch, 25, who flies on business about 15 times a year. But he does keep them abreast of the company's financial situation, operating under the assumption that if employees know where a company's money is going, they'll pay closer attention to expenses now in anticipation of a bigger payoff later.

Ulevitch understands that striking the right balance between tightwad tactics and too-loose lenience can be difficult. But whether you're a start-up or a multimillion-dollar corporation, slashing unnecessary costs is important to a company's growth.

Especially now. That's because the costs associated with business travel are on the rise.

A report released last month by American Express Business Travel found that the average cost of a domestic roundtrip plane ticket rose 7 percent last year (from $216 to $231), while the average international roundtrip fare rose 5 percent (from $1,614 to $1,707).

What's more, hotel and car rental rates are also mushrooming, according to American Express. Car rentals charges climbed 4.5 percent last year, and the average price for a night's stay in an American hotel room jumped from $182 to $200.

That's got many managers looking to minimize expenditures. The key? Finding ways that will have minimal effect on your employees and maximum effect on your bottom line.

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