Dunder Mifflin has lost several clients to The Michael Scott Paper Company over the past few weeks. While this appears to bode well for Michael, Pam, and Ryan, their low prices are actually gradually putting them out of business.

“When a child gets behind the wheel of a car and runs into a tree, you don’t blame the child. You blame the 33 year old woman who got into the passenger seat and said ‘Drive, child.’”

When trying to calculate the cost of a morning delivery man to assist in paper distribution, Michael realizes that his leverage over the competition, ridiculously low prices, is dragging him under. This is left unknown to David Wallace and the rest of Dunder Mifflin, however.

As The Michael Scott crew lament their impending closure, David Wallace and Charles meet with Dwight and Jim to discuss how to increase Dunder Mifflin’s revenue. During the meeting, Charles realizes how inept Dwight actually is. After brainstorming, David suggests that the cheapest option is to buy out Michael’s company. Now disillusioned with Dwight’s incompetence, Charles backs David’s decision to have Jim offer Michael a deal.

Michael accepts the offer and goes upstairs, worried that he may accidentally let it slip that his company is going under. In his meeting with David and Charles, Michael surprises both parties with strong negotiation skills.

Dwight finds out that The Michael Scott Paper Co has been calling clients and asking for more money, and therefore is going broke. He reports this to Charles, who is infuriated with Dwight and Jim that they did not discover this earlier. He doesn’t allow it to affect the deal.

David initially offers $60,000, but Michael rejects the offer, suggesting to Pam and Ryan instead that they ask for their old jobs back in addition to the buyout. When David points out that including salaries, healthcare benefits, etc. with the buyout, this is actually a multi-million dollar offer. Michael stands firm, and David accepts his terms which includes sales positions for Pam and Ryan. Michael, Pam, and Ryan celebrate and Michael proudly kicks Charles out of the office.