“That’s what we refer to as the intelligent loss of sales,” Sinegal explained. “If we had all of those sizes, I could do the math and show you where you would do less business as a result of having all of those sizes available.”

Not only does Costco carry items in one size, but its low product count means it only carries very select brands.

“One ketchup, one bottle, one package, one choice,” explained marketing consultant Pam Danziger. “You don’t have to make those decisions. You don’t choose from a variety of other ones.”

Limited selection, according to Danziger, makes it easier for the consumer to choose. “There was a research study in marketing that if you offer people 24 different types of jellies, you’re not going to sell as many as if you offer them six,” she said. “Making people decide, that causes confusion, and they ultimately decide to walk away. At Costco, you don’t have to make those decisions.”

Danziger says that Costco has, in effect, done the shopping for you.

With such low prices and thin margins, it might be logical to expect Costco’s pay and benefits to be equally bare bones, but that’s one more way the company has defied common wisdom. Costco actually has among the highest pay scales in the industry — its employees earn an average of $20 an hour, and more than 90 percent get benefits, including health insurance. In reward, Costco has some of the lowest turnover rates in retail.

It also has no public relations team — a genuine rarity among Fortune 100 companies. Media inquiries are handled personally by its chief financial officer, Rich Galanti. Senior executives do not travel with a support staff, and it is not unusual for the CEO to answer his own phone. According to Sinegal, it’s all part of culture of Costco.

“We try to create an open door policy around here,” Sinegal said, “open-wall, if you will.”

Open wall is no exaggeration — the offices of Sinegal, CEO Craig Jelinek and other executives are completely open to the hallway.

Despite its peculiar business model, Costco is a runaway success — it is now the second-largest U.S. retailers, behind only Wal-Mart, and its stock has soared more than 5,000 percent since going public in the mid-1980s. For Sinegal, the standard rules may not apply, but a simple idea seems to prevail.

"All we're trying to do is sell stuff cheaper than anybody else,” he said, “but there’s a lot more work that goes into it.”