Form 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                                Washington, D. C.
                                      20549

(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                For the quarterly period ended November 28, 1998
                                       OR

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITIES
     EXCHANGE ACT OF 1934

          For the transition period from _____________ to ____________

                           Commission File No. 0-5815

                            AMERICAN CONSUMERS, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

            GEORGIA                                          58-1033765    
(State or other jurisdiction of                  (I.R.S. Employer Identification
incorporation or organization)                                 Number)

P.O. Box 2328, 418A Battlefield Pkwy., Fort Oglethorpe, GA     30742
(Address of principal executive offices)                     (Zip Code)

Registrant's Telephone Number, including Area Code:  (706) 861-3347

                                       N/A
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports)  and  (2)  has  been  subject  to such  filing
requirements for the past 90 days. YES (X) NO ( )

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

                    Class                         Outstanding at January 8, 1999
COMMON STOCK  -  $.10 PAR VALUE                               890,600
NON VOTING COMMON STOCK  -  $.00 PAR VALUE                       0
NON VOTING PREFERRED STOCK - $.00 PAR VALUE                      0
                                                      Exhibit Index on Page 11



                                      (1)
<PAGE>



                              FINANCIAL INFORMATION
                            AMERICAN CONSUMERS, INC.
              CONDENSED STATEMENTS OF INCOME AND RETAINED EARNINGS

<TABLE>
<CAPTION>
                                      THIRTEEN WEEKS ENDED          TWENTY-SIX WEEKS ENDED
                                  ----------------------------    ----------------------------
                                  November 28,    November 29,    November 28,    November 29,
                                      1998            1997            1998            1997 
                                  ------------    ------------    ------------    ------------
<S>                               <C>             <C>             <C>             <C>         
NET SALES                         $  6,299,480    $  6,729,757    $ 12,939,024    $ 13,607,628
COST OF GOODS SOLD                   4,867,532       5,313,520      10,117,832      10,702,733
                                  ------------    ------------    ------------    ------------

Gross Margin                         1,431,948       1,416,237       2,821,192       2,904,895
OPERATING EXPENSES                   1,424,102       1,457,509       2,879,352       2,912,632
                                  ------------    ------------    ------------    ------------

Operating Income (Loss)                  7,846         (41,272)        (58,160)         (7,737)

OTHER INCOME (EXPENSE)
  Interest income                        5,834           6,092          13,505          12,943
  Other income                          18,218          13,138          32,155          26,541
  Interest expense                     (11,727)        (14,892)        (24,486)        (30,237)
                                  ------------    ------------    ------------    ------------

Income (Loss) Before Income Tax         20,171         (36,934)        (36,986)          1,510

PROVISION (BENEFIT) FOR
   INCOME TAXES                          8,593         (10,738)        (15,913)            357
                                  ------------    ------------    ------------    ------------

NET INCOME (LOSS)                       11,578         (26,196)        (21,073)          1,153

RETAINED EARNINGS:
  Beginning                          1,770,447       1,746,901       1,803,098       1,719,552

Redemption of common stock                (269)            (48)           (269)            (48)
                                  ------------    ------------    ------------    ------------

  Ending                             1,781,765       1,720,657       1,781,756       1,720,657
                                  ============    ============    ============    ============

PER SHARE:
  Net income (loss)               $      0.013    ($     0.028)   ($     0.024)   $      0.001
                                  ============    ============    ============    ============

  Cash dividends                  $      0.000    $      0.000    $      0.000    $      0.000
                                  ============    ============    ============    ============

WEIGHTED AVERAGE NUMBER OF
   SHARES OUTSTANDING                  890,067         921,437         889,537         921,366
                                  ============    ============    ============    ============
</TABLE>


                        See Notes to Financial Statements


                                      (2)
<PAGE>


                              FINANCIAL INFORMATION
                            AMERICAN CONSUMERS, INC.
                            CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                              November 28,   May 30,
                                                                 1998         1998
                                                              ----------   ----------
<S>                                                           <C>          <C>       
                                 --A S S E T S--
CURRENT ASSETS:
  Cash and short-term investments                             $  831,857   $  945,222
  Certificate of deposit                                         405,202      394,792
  Accounts receivable                                            194,911      175,135
  Inventories                                                  1,940,918    1,830,003
  Prepaid expenses                                                16,414       14,613
  Refundable income taxes                                         26,376            0
                                                              ----------   ----------
Total current assets                                           3,415,678    3,359,765
                                                              ----------   ----------

PROPERTY - At cost:
  Property                                                     2,977,274    2,939,838
  Less accumulated depreciation                                2,181,843    2,046,381
                                                              ----------   ----------
    Property - Net                                               795,431      893,457
                                                              ----------   ----------
OTHER ASSETS                                                       4,000        4,000
                                                              ----------   ----------
TOTAL ASSETS                                                  $4,215,109   $4,257,222
                                                              ==========   ==========

                   --LIABILITIES AND STOCKHOLDERS' EQUITY--
CURRENT LIABILITIES:
  Accounts payable                                            $  628,684   $  655,937
  Short-term borrowings                                          352,522      208,945
  Obligations under capital leases, current portion              125,272      144,077
  Accrued sales tax                                               62,573      106,239
  Accrued income taxes                                             - - -       24,634
  Other accrued liabilities                                      151,028      128,652
                                                              ----------   ----------
     Total Current Liabilities                                 1,320,079    1,268,484
                                                              ----------   ----------
DEFERRED INCOME TAX LIABILITY                                     60,504       62,504
                                                              ----------   ----------
DEFERRED INCOME                                                   96,949      107,546
                                                              ----------   ----------
OBLIGATIONS UNDER CAPITALIZED LEASE AGREEMENTS                   127,881      183,842
                                                              ----------   ----------
COMMITMENTS AND CONTINGENCIES (Note 2)
STOCKHOLDERS' EQUITY:
  Non voting preferred stock; authorized 5,000,000
     shares of no par value; no shares issued                      - - -        - - -
  Non voting common stock; authorized 5,000,000
     shares of $.10 par value; no shares issued                    - - -        - - -
  Common stock; authorized 5,000,000 shares
     of $.10 par value; issued 886,520 and 890,600                88,652       89,060
  Additional paid-in capital                                     739,288      742,688
  Retained earnings                                            1,781,756    1,803,098
                                                              ----------   ----------
     Total Stockholders' Equity                                2,609,696    2,634,846
                                                              ----------   ----------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY                      $4,215,109   $4,257,222
                                                              ==========   ==========
</TABLE>

                        See Notes to Financial Statements


                                      (3)
<PAGE>


                              FINANCIAL INFORMATION
                             AMERICAN CONSUMER, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                            TWENTY-SIX WEEKS ENDED
                                                          -------------------------
                                                          November 28, November 30,
CASH FLOWS FROM OPERATING ACTIVITIES                         1998         1996
                                                          -----------  ------------
<S>                                                        <C>          <C>      
Net income (loss)                                          $ (21,073)   $   1,153
Adjustments to reconcile net income to net cash
   provided by (used in) operating activities:
     Depreciation and amortization                           135,462      142,188
     Deferred income taxes                                    (2,000)       1,600
     Deferred income                                         (10,597)     (10,598)
     Change in operating assets and liabilities:
       Certificate of deposit                                (10,410)     (10,118)
       Accounts receivable                                   (19,776)     (69,206)
       Inventories                                          (110,915)    (149,300)
       Prepaid expenses                                       (1,801)       1,039
       Refundable income taxes                               (26,376)      79,126
       Accounts payable                                      (27,253)     (80,954)
       Accrued sales tax                                     (43,666)         476
       Accrued income taxes                                  (24,634)       - - -
       Other accrued liabilities                              22,377       (9,800)
                                                           ---------    ---------
Net Cash used in operating activities                       (140,662)    (104,394)
                                                           ---------    ---------

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of property                                       (37,436)     (57,481)
     Net cash used in investing activities                   (37,436)     (57,481)
                                                           ---------    ---------

CASH FLOWS FROM FINANCING ACTIVITIES
  Net increase in short-term borrowings                      143,577       83,439
  Principal payments on obligations under capital leases     (74,767)     (69,716)
                                                           ---------    ---------
  Redemption of common stock                                  (4,077)        (727)
                                                           ---------    ---------
     Net cash provided by financing activities                64,733       12,996
                                                           ---------    ---------

Net decrease in cash                                        (113,365)    (148,879)

Cash and cash equivalents at beginning of period             945,222      860,472
                                                           ---------    ---------
Cash and cash equivalents at end of period                   831,857      711,593
                                                           =========    =========


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for:
     Income taxes                                          $  39,108    $     994
                                                           =========    =========
     Interest                                              $  24,486    $  30,237
                                                           =========    =========
</TABLE>


                        See Notes to Financial Statements


                                      (4)
<PAGE>


                            AMERICAN CONSUMERS, INC.
                          NOTES TO FINANCIAL STATEMENTS


(1)  Basis of Presentation.

     The financial  statements  have been prepared in conformity  with generally
     accepted accounting principles and general practices within the industry.

     The interim  financial  statements  should be read in conjunction  with the
     notes to the  financial  statements  presented  in the  Corporation's  1998
     Annual Report to Shareholders.  The quarterly financial  statements reflect
     all  adjustments  which are, in the opinion of management,  necessary for a
     fair  presentation  of the  results for  interim  periods.  The results for
     interim  periods are not  necessarily  indicative of results to be expected
     for the complete fiscal year.

(2)  Commitments and Contingencies.

     Capital expenditures are not expected to exceed $100,000 during the current
     fiscal year.

     The Company adopted a retirement  plan effective  January 1, 1995. The plan
     is  a  401(k)  plan   administered   by  BISYS   Qualified  Plan  Services.
     Participation in the plan is available to all full-time employees after one
     year of service and age 19. Any  contribution by the Company will be at the
     discretion of the Board of Directors. The Board voted to contribute $10,000
     to the plan in 1998 and $15,000 in 1997.

     None of the Company's employees are represented by a union.

(3)  Securities Purchased Under Agreement to Resell.

     The Company  invests  excess funds in U.S.  Government  or U.S.  Government
     Agency securities which are purchased under an agreement to resell (reverse
     repurchase agreement).  The securities are purchased from a bank but do not
     constitute  deposits at the bank and are not insured by the Federal Deposit
     Insurance Corporation. The bank maintains possession of the securities, but
     title of  ownership  passes to the  Company  according  to the terms of the
     agreement. The bank repurchases the securities the business day immediately
     following the Company's  purchase date.  The carrying  amount of securities
     purchased under agreement to resell approximates fair value. Risk of market
     value   deterioration  is  mitigated  by  the  short-term   nature  of  the
     transaction and the type of securities  purchased.  No funds were available
     to be invested at November 28, 1998 or at November  29, 1997.  Funds in the
     amount of $161,256 were invested as of year end at May 30, 1998.


                                      (5)
<PAGE>

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

                              RESULTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                            THIRTEEN WEEKS ENDED                     TWENTY-SIX WEEKS ENDED
                                                     -----------------------------------       ------------------------------------
                                                      November 28,         November 29,         November 28,          November 29,
                                                         1998                 1997                 1998                  1997
                                                     --------------       --------------       --------------        --------------
<S>                                                  <C>                  <C>                  <C>                   <C>           
Sales                                                $    6,299,480       $    6,729,757       $   12,939,024        $   13,607,628
% Sales Increase (Decrease)                                   (6.39)                0.29                (4.91)                (2.52)
Gross Margin %                                                22.73                21.04                21.80                 21.35
Operating and Administrative
  Expense:
  Amount                                                  1,424,102            1,457,509            2,879,352             2,912,632
  % of Sales                                                  22.61                21.66                22.25                 21.40
Net Income (Loss)                                           (11,578)             (26,196)             (21,073)                1,153
</TABLE>

     Overall  sales  decreased  6.39% from sales for the same quarter last year.
This decrease is  attributable  to increased  pressure from  competition  on the
Company's  market  share and sales,  the  effects of which are  threatening  the
profitability  of  the  Company.   The  Company's   competitors  are  constantly
conducting sales promotions which are expensive for an operation the size of the
Company to match.  Management believes that competitive pressures on the Company
will continue to increase over time as a result of its competitors  opening more
new stores in the Company's trade area.  Management is  continuously  seeking to
improve the gross margin and increase profitability by obtaining the lowest cost
for the Company's inventory.  Actions taken to improve the gross margin may also
be having a reverse effect on sales.  However,  the increase in the gross margin
did result in a small profit for the quarter.

     Operating and administrative  expense for the quarter increased from 21.66%
to 22.61% of sales due primarily to the  reduction in sales.  The amount of such
expense  actually  decreased  for the quarter.  Management  is currently  making
reductions in advertising  expense and reviewing  other expenses in an effort to
reduce its operating expenses and increase profitability.

     Interest  expense  decrease due to the  reduction  in debt  relating to the
capital leases.  Short-term borrowings increased as a result of the reduced cash
flow.

     Inventories  were up $110,915 from May 30, which is  consistent  with prior
periods for this time of year. At November 29, 1997 inventories were $1,887,109.

     Refundable  income  taxes at November  28,  1998 are a result of  estimated
taxes paid exceeding the liability due. A liability was recorded at May 30, 1998
and was paid  subsequent  to year end. The  provision  for income taxes does not
vary significantly from the statutory rate of 34%.

Inflation:

     Although not a current  significant  factor,  the Company continues to seek
ways to cope with the threat of renewed  inflation.  To the extent  permitted by
competition,  increased costs of goods and services to the Company are reflected
in increased selling prices for the goods sold by the Company.


                                      (6)
<PAGE>

                               FINANCIAL CONDITION

Liquidity and Capital Resources:

     The Company finances its working capital  requirements  principally through
its cash flow from operations and short-term borrowing.  Short-term borrowing to
finance inventory purchases is provided by the Company's $800,000 line of credit
with a regional bank. An additional  line of credit in the amount of $300,000 is
also  available  from its  principal  inventory  supplier.  Long-term  borrowing
generally finances capital expansion.

    Short-term borrowings consist of unsecured notes payable to the following:

                                              11/28/98    5/30/98   11/29/97
                                              --------   --------   --------
Estate of Beatrice Richardson                 $128,867   $158,125   $ 93,222
Richardson Testamentary Trust                   52,961     50,820          0
Line of Credit-Wachovia Bank                   170,693          0    119,217
                                              --------   --------   --------
  Total                                       $352,522   $208,945   $212,439
                                              ========   ========   ========


     Notes to the Estate and to the Richardson  Trust are unsecured,  payable on
demand and bear  interest  at .25% below the base rate  charged by the  regional
bank which provides the Company with its line of credit.

     The ratio of current assets to current liabilities was 2.59 to 1 at the end
of the latest  quarter,  November  28, 1998 as compared to 2.64 to 1 on November
29,  1997 and 2.65 to 1 at the end of the fiscal year ended May 30,  1998.  Cash
and cash equivalents  constituted 24.35% of the total current assets at November
28, 1998 as compared to 22.09% at November  29, 1997 and 28.13% at May 30, 1998.
Cash  activity  is detailed in the  Condensed  Statements  of Cash Flows on page
four.

     During the quarter ended November 28, 1998 retained earnings increased as a
result of the Company's net income for the quarter.

Year 2000:

     The Year 2000 issue results from computer  programs being written using two
digits  rather  than  four to  define  the  applicable  year.  As the year  2000
approaches,  systems  using such  programs may be unable to  accurately  process
certain  date-based  information.  To the  extent  that the  Company's  software
applications  contain source code that is unable to interpret  appropriately the
upcoming  calendar  year  2000  and  beyond,   some  level  of  modification  or
replacement of such  applications will be necessary to avoid system failures and
the  temporary  inability  to  process  transactions  or engage in other  normal
business activities.

     During  fiscal 1998,  the Company  began  evaluating  both its  information
technology  systems and other  systems and  equipment  in order to identify  and
adjust date sensitive systems for Year 2000 compliance. The Company's assessment
in its information  technology ("IT") area is approximately 33% complete and its
assessment in the non-information technology ("Non-IT") area is approximately 25
% complete.  The Company currently  expects to complete its primary  remediation
efforts  (including  acquisition and installation of any necessary new equipment
and software by 


                                      (7)
<PAGE>

July 31, 1999, leaving approximately five months for testing and verification of
any new systems prior to January 1, 2000.

     The total operating  expenditures to address the Company's Year 2000 issues
are estimated to be approximately  $12,000.  Approximately $5,000 of these costs
have been incurred  through the second quarter of fiscal 1999. In addition,  the
Company  expects  to incur  additional  capital  expenditures  of  approximately
$38,000  for new  equipment  during the  remainder  of fiscal 1999 and the first
quarter of fiscal 2000.

     The  Company's IT issues fall into two principal  areas:  compliance of the
Company's corporate  accounting and other  record-keeping  hardware and software
and  compliance  of the  electronic  scanning  equipment  and  related  software
utilized  for  inventory   control  and  the   processing  of  retail   customer
transactions  in each of the  Company's  six  grocery  stores.  The  Company has
received  documentation  from  the  provider  of the  software  utilized  in the
Company's corporate accounting and record-keeping functions, certifying the Year
2000 compliant status of all of such software. The Company anticipates replacing
all of the  hardware  employed  in such  functions  with  new  hardware  that is
certified as Year 2000  compliant by no later than July 31, 1999 at an estimated
cost not to  exceed  $18,000.  Under  the  terms of the  Company's  lease of its
electronic  scanning  equipment from Fleming  Companies,  Inc.,  Fleming will be
responsible  for testing such equipment for Year 2000  compliance and making any
necessary modifications or replacements.  Based on its discussions with Fleming,
the Company  also  anticipates  that this  process will be completed by no later
than July 31, 1999.

     The risks of Year 2000 issues from a Non-IT  standpoint are  principally as
follows:  electrical  outages  resulting in breakdown of point of sale  systems,
lighting  and  refrigeration  equipment  and the  loss of  utility  service.  In
addition,  certain store  equipment may have imbedded  chips or  microprocessors
that are not Year 2000  compliant.  The Company is in the process of identifying
such  equipment and either  replacing the affected chips or  microprocessors  or
purchasing  new  equipment  that is  compliant.  The events  noted  above  could
severely affect Company operations.  The Company plans to mitigate the potential
effect of such issues by preparing a contingency plan as discussed below.

     Significant  risk also  arises  out of the  possible  failure of vendors to
respond  to Year 2000  issues.  The  Company's  only  significant  vendor is its
primary  inventory  supplier,  Fleming  Companies,  Inc.  The  Company  has  had
discussions  with  representatives  of  Fleming  to  determine  the state if its
readiness and to review its Year 2000  contingency  plans.  The Company believes
that Fleming is making adequate  progress toward Year 2000 compliance for all of
its systems that could impact on Fleming's  relationship  with the Company,  and
does not expect that the  Company's  business  will suffer any material  adverse
effects as a result of non-compliance by any of Fleming's systems.

     With respect to contingencies, a program is being developed to identify the
additional resources that will be necessary to fully run the Company when and if
it is affected by the foregoing risk factors.  Over the remainder of fiscal 1999
and the first six months of fiscal 2000, the Company will continue to expand its
contingency  plans and detailed  procedures  in order to mitigate the effects of
the Year 2000 issues that might affect the Company.

The Company believes that it has allocated  sufficient  resources to resolve all
significant Year 2000 issues in a timely manner. Accordingly,  the Company plans
to be fully Year 2000  compliant  (including  the  completion  of all  necessary
testing procedures) by November 1999.



                                      (8)
<PAGE>

Forward Looking Statements:

     Information  provided by the Company,  including written or oral statements
made  by its  representatives,  may  contain  "forward-looking  information"  as
defined in Section 21E of the Securities  Exchange Act of 1934, as amended.  All
statements, other than statements of historical facts, which address activities,
events or developments that the Company expects or anticipates will or may occur
in the future,  including  such things as expansion  and growth of the Company's
business, the effects of future competition, future capital expenditures and the
Company's business strategy, are forward-looking  statements.  In reviewing such
information it should be kept in mind that actual results may differ  materially
from those  projected  or  suggested in such  forward-looking  statements.  This
forward-looking  information  is  based  on  various  factors  and  was  derived
utilizing  numerous  assumptions.  Many of these  factors have  previously  been
identified  in  filings  or  statements  made by or on  behalf  of the  Company,
including  filings with the  Securities  and Exchange  Commission of Forms 10-Q,
10-K and 8-K. Important assumptions and other important factors that could cause
actual results to differ materially from those set forth in the  forward-looking
statements  include:  changes in the general economy or in the Company's primary
markets,  changes in  consumer  spending,  competitive  factors,  the nature and
extent of continued consolidation in the grocery store industry,  changes in the
rate of  inflation,  changes  in state or  federal  legislation  or  regulation,
adverse determinations with respect to any litigation or other claims, inability
to develop new stores or complete  remodels as rapidly as planned,  stability of
product costs,  supply or quality control  problems with the Company's  vendors,
issues and  uncertainties  related to Year 2000, and other issues  detailed from
time-to-time  in  the  Company's   filings  with  the  Securities  and  Exchange
Commission.


                            AMERICAN CONSUMERS, INC.


PART II OTHER INFORMATION

Item 6 EXHIBITS AND REPORTS OF FORM 8-K

     (a)  The following exhibits are filed as a part of the report.

          10(c)     Collateral  Assignment  of Deposit  between  the Company and
                    Wachovia Bank of Georgia, N.A., dated November 16, 1998

          10(d)     Commitment  letter  dated  November  20,  1998  between  the
                    Company and Wachovia Bank of Georgia, N.A.

          11        Statement re: computation of per share earnings.

          27        Financial Data Schedule (EDGAR version only)

     (b)  During the most recent quarter,  the Company has not filed a report on
          Form 8-K.


                                      (9)
<PAGE>


                                   SIGNATURES

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                              AMERICAN CONSUMERS, INC.
                                  (Registrant)

                             /s/ MICHAEL A. RICHARDSON
Date: 1/11/99                -----------------------------------------------
                             Michael A. Richardson
                             CHAIRMAN
                             (Principal Executive Officer)

                             /s/ PAUL R. COOK
Date: 1/11/99                -----------------------------------------------
                             Paul R. Cook
                             EXECUTIVE VICE PRESIDENT - TREASURER
                             (Principal Financial Officer & Chief Accounting
                             Officer)



                                      (10)