Married again to Elizabeth and working as Martin at Sunshine Desserts - where he runs the Reginald Perrin Memorial Trust - Reggie is now getting dissatisfied with his new identity and keen to return to being his old self. Joan sees through the disguise, and tries to blackmail him into having sex with her. Doc Morrissey, the firm's vague old medical officer, also knows who Martin really is and tells C.J. C.J. however fires both Doc and 'Martin', who reverts to being toothy Donald Potts and working in a piggery.

After a disastrous morning working at Tom's estate agency, Reggie returns to the piggery as himself, but does his back in, so Elizabeth decides that she will become the bread-winner. She gets a job as secretary to C.J. at Sunshine Desserts but does not want Reggie to know, so she claims that her employers are the British Basket Company. Reggie is suspicious as his efforts to find the company come to nothing. C.J. tries it on with Elizabeth at home whilst his wife is away but stops himself in time. Then, on Monday morning Reggie follows his wife and discovers where she really works.

Reggie suspects Elizabeth of having an affair, leading to a punch-up in the firm's car park and a double black eye. He returns to the piggery but gets the sack after his employer finds out who he really is. Elizabeth also gets the sack after altering some of C.J.'s letters. Reggie goes to visit Jimmy, whom is hoarding guns under his bed. He tells an appalled Reggie of his plan to form a private right-wing army to rid the country of all do-gooders and - as he sees it - scroungers. Having told Jimmy his plan is rubbish, Reggie forms his own idea. He will open a shop selling rubbish to a gullible public and will call it Grot.

Reggie asks C.J. for a start-up loan to establish his shop Grot. C.J. thinks it's hush money to keep quiet about his hitting on Elizabeth and lends it to him. Grot sells highly unusual and often impractical things but people buy them,either because they are unique, such as square hula hoops, which in fact become a craze,or as presents for relatives they dislike, like Tom's turnip wine. Grot becomes a huge success and Reggie quickly has the wherewithal to repay the loan. However, when he returns to Sunshine Desserts to see his old boss he finds things have changed. Joan is now married to his former colleague Tony, and the firm is on the verge of collapse.

Reggie is about to open his fiftieth Grot shop whilst Sunshine Desserts has gone bust and is now a thing of the past. Generously Reggie decides to employ C.J. but makes him wait an extra week for his interview and enjoys having power over him. He asks Joan to be his secretary again but she and Tony are already having marital problems, which Reggie sorts out before employing them both. Elizabeth is annoyed that Reggie has yet to offer her a job with the shop, but eventually he does - even imagining her mother as a hippopotamus, just like old times.

Scared by the fraudulent success of Grot, Reggie decides to kill off the monster he has created by giving executive posts to men he sees as incompetents - Doc Morrissey, Jimmy, Tom and an Irishman called Seamus in the hopes that they will destroy the shop chain. However the business goes on to even greater heights as a result, thanks to Tom's advertising slogans, leading to a television advert, and a useless machine made by Jimmy, which becomes the latest must-have item. He is mindful to sack them but feels he cannot fire in-laws and ends up by giving Seamus, who has seen through his ruse, a raise.

Desperate to kill off Grot, Reggie goes to extreme lengths, such as insulting chat show hosts on whose television shows he appears. He also insults a job applicant who mistakenly believes he is making a pass at him so he pretends to be gay when visiting the branch manager, only to find that he is gay and is attracted to Reggie. He dresses in drag in public but by now everybody is used to Reggie's eccentric behaviour and sees it as the norm. Finally he and Elizabeth go back to the beach and fake a double suicide, only to discover that they have set a trend and scores of people are following suit in order to reinvent themselves.