The central twist of "The Shop Around the Corner" is the revelation that the two main characters, Alfred Kralik and Klara Novak, who despise each other at work, are unknowingly the anonymous pen pals who have fallen deeply in love through their letters. The moment of discovery for the audience and for Kralik occurs at the Cafe Nizza. Kralik arrives for his rendezvous and, peering through the window, sees Klara sitting alone, holding the agreed-upon signals: a copy of "Anna Karenina" with a red carnation.
From this point on, the film's dynamic shifts. Kralik knows their shared secret, but Klara remains oblivious. Instead of revealing himself, Kralik approaches her as her annoying coworker, leading to a scene rich with dramatic irony where she complains about him to his face while waiting for her ideal man (also him) to arrive. This withholding of information drives the final act. A significant subplot involves Mr. Matuschek's marital problems. He wrongly suspects Kralik of being his wife's lover and fires him. Later, a private investigator reveals the real adulterer is another employee, the slick Ferencz Vadas. This revelation leads to Mr. Matuschek's attempted suicide, which is thwarted by the delivery boy, Pepi. Matuschek, deeply remorseful, promotes Kralik to store manager.
The climax occurs on Christmas Eve in the now-empty shop. Kralik, having gently courted Klara in person for days, finally reveals his identity. He does so by subtly referencing their letters, describing her pen pal as short, paunchy, and balding before finally admitting, "I am your dear friend." Klara, realizing the truth, is momentarily confused but ultimately delighted. In a final poignant reveal, she confesses that she tried to dislike him at first because she had a crush on him when they first met and was following advice from a novel on how to attract a man by treating him poorly. This final confession beautifully resolves their entire antagonistic relationship, showing it was rooted in a misguided attempt at courtship from the very beginning. They embrace, their idealized love and real-life affection finally united.