SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB


           [X] Quarterly Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                  For the quarterly period ended March 31, 1998

          [ ] Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                 For the transition period from ______ to ______

                         Commission file number 0-20743


                             OPEN PLAN SYSTEMS, INC.
        (Exact name of small business issuer as specified in its charter)


          Virginia                                       54-1515256
  (State or other jurisdiction of             (IRS Employer Identification No.)
   incorporation or organization)

          4299 Carolina Avenue,                                23222
     Building C, Richmond, Virginia                         (Zip Code)
 (Address of principal executive office)

                                 (804) 228-5600
                           (Issuer's telephone number)

          _____________________________________________________________
(Former name,former address and former fiscal year,if changed since last report)


     Check  whether  the issuer:  (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 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 __.

     State the number of shares  outstanding of each of the issuer's  classes of
common equity, as of the latest practicable date:

         Common Stock, no par value - 4,472,433 shares as of May 12, 1998.

 Transitional Small Business Disclosure Format (check one):  Yes         No   X

<PAGE>
 
                             OPEN PLAN SYSTEMS, INC.

                                Table of Contents

<TABLE>
<CAPTION>

PART I.     FINANCIAL INFORMATION                                                                     Page

<S>        <C>                                                                                        <C>    
Item 1.    Financial Statements

           Consolidated Balance Sheets - March 31, 1998 (unaudited)                                    1
              and December 31, 1997
 
           Consolidated Statements of Operations- Three months                                         2
              ended March 31, 1998 and 1997 (unaudited)

           Consolidated Statements of Cash Flows - Three months                                        3
              months ended March 31, 1998 and 1997 (unaudited)

           Notes to Consolidated Financial Statements - March 31, 1998                                 4

Item 2.    Management's Discussion and Analysis of                                                     9
           Financial Condition and Results of Operations


PART II.   OTHER INFORMATION

Item 1.    Legal Proceedings                                                                          11

Item 2.    Changes in Securities and Use of Proceeds                                                  11

Item 3.    Defaults Upon Senior Securities                                                            11

Item 4.    Submission of Matters to a Vote of                                                         11
              Security Holders

Item 5.    Other Information                                                                          11

Item 6.    Exhibits and Reports on Form 8-K                                                           11


SIGNATURES
</TABLE>
<PAGE>

                                         OPEN PLAN SYSTEMS, INC.
                                                  PART I
                                          FINANCIAL INFORMATION
                                       Item 1: Financial Statements
                                       Consolidated Balance Sheets
                                          (amounts in thousands)
<TABLE>
<CAPTION>

                                                                              March 31,        December 31,
                                                                                1998              1997
                                                                         -------------------------------------
                                                                            (Unaudited)
<S>                                                                        <C>                <C> 
 Assets
   Current assets:
      Cash and cash equivalents                                            $          111     $           73
      Trade accounts receivable, net                                                5,097              5,486
      Inventories                                                                   9,746             10,780
      Prepaids and other                                                              669                686
      Refundable income taxes                                                         795                795
      Deferred income taxes                                                          -                   106
                                                                         -------------------------------------
   Total current assets                                                            16,418             17,926

   Property and equipment, net                                                      3,600              3,493
   Goodwill, net                                                                    4,368              4,427
   Other                                                                              486                468
                                                                         -------------------------------------
   Total assets                                                            $       24,872   $         26,314
                                                                         =====================================

   Liabilities and stockholders' equity
   Current liabilities:
      Trade accounts payable                                             $          1,823   $          2,411
      Accrued compensation                                                            403                393
      Other accrued liabilities                                                       248                280
      Customer deposits                                                               741                841
      Line of credit                                                                2,726              2,110
      Current portion of long-term debt and capital lease
        obligations                                                                    95                126
                                                                         -------------------------------------
   Total current liabilities                                                        6,036              6,161

   Deferred income taxes                                                             -                   110
                                                                         -------------------------------------
   Total liabilities                                                                6,036              6,271

   Stockholders' equity:
      Common stock, no par value:
        Authorized shares - 50,000
        Issued and outstanding shares - 4,472                                      20,088             20,088
      Additional capital                                                              137                137
      Retained earnings                                                            (1,389)              (182)
                                                                         -------------------------------------
   Total stockholders' equity                                                      18,836             20,043
                                                                         -------------------------------------
   Total liabilities and stockholders' equity                              $       24,872   $         26,314
                                                                         =====================================

See accompanying notes.
</TABLE>

<PAGE>

                                             OPEN PLAN SYSTEMS, INC.

                               Consolidated Statements of Operations (Unaudited)
                                    (amounts in thousands, except per share)
<TABLE>
<CAPTION>

                                                                   Three Months ended March
                                                                         31
                                                                1998              1997
                                                         ------------------------------------
<S>                                                      <C>                   <C>

Net sales                                                  $     7,900         $    6,437
Cost of sales                                                    6,256              4,976
                                                         ------------------------------------
Gross profit                                                     1,644              1,461

Operating expenses:
   Amortization of intangibles                                      69                 69
   Selling and marketing                                         1,972              1,250
   General and administrative                                      744                728
                                                         ------------------------------------
                                                                 2,785              2,047
                                                         ------------------------------------
Operating loss                                                  (1,141)              (586)

Other (income) expense:
   Interest expense                                                 66                  8
   Interest income                                                   -                (35)
   Other, net                                                        -                (10)
                                                         ------------------------------------
                                                                    66                (37)
                                                         ------------------------------------
Loss before income taxes                                        (1,207)              (549)

Income tax benefit                                                   -               (234)
                                                         ------------------------------------
Net loss                                                  $     (1,207)     $        (315)
                                                         ====================================

Basic and diluted loss per common share                  $        (.27)     $        (.07)
                                                         ====================================
Weighted average common shares outstanding                       4,472              4,472
                                                         ====================================

</TABLE>

       See accompanying notes.
<PAGE>


                                           OPEN PLAN SYSTEMS, INC.

                              Consolidated Statements of Cash Flows (Unaudited)
                                            (amounts in thousands)

<TABLE>
<CAPTION>
                                                                   Three Months ended
                                                                      March 31
                                                               1998             1997
                                                         ----------------------------------
<S>                                                      <C>                <C>  
Operating activities
Net loss                                                   $      (1,207)   $        (315)
Adjustments to reconcile net loss to net cash used in
   operating activities:
   Provision for losses on receivables                                 -               29
   Depreciation and amortization                                     277              282
    Loss on sale of property                                          15                -
   Deferred income taxes                                               4               (8)
   Changes in operating assets and liabilities:
     Accounts receivable                                             389             (155)
     Inventories                                                   1,034             (915)
     Prepaids and other                                              (11)            (390)
     Trade accounts payable                                         (588)             247
     Customer deposits                                              (100)             108
     Accrued and other liabilities                                   (22)              49
                                                         ----------------------------------
Net cash used in operating activities                               (217)          (1,070)

Investing activities
Purchases of property and equipment                                 (330)            (341)
                                                         ----------------------------------
Net cash used in investing activities                               (330)            (341)

Financing activities
Net borrowings on revolving line of credit                           616                -
Principal payments on long-term debt, and capital
   lease  obligations                                                (31)             (46)
                                                         ----------------------------------
Net cash (used in) provided by financing activities                  585              (46)
                                                         ----------------------------------

Increase (decrease) in cash and cash equivalents                      38           (1,457)

Cash and cash equivalents at beginning of period                      73            3,066
                                                         ----------------------------------
Cash and cash equivalents at end of period               $            11   $        1,609
                                                         ==================================

Supplemental disclosures
Interest paid                                            $            66   $            8
                                                         ==================================
Income taxes paid                                        $            12   $           17
                                                         ==================================
</TABLE>

See accompanying notes.
<PAGE>
                             OPEN PLAN SYSTEMS, INC.

             Notes to Consolidated Financial Statements (Unaudited)
                                 March 31, 1998

1. Basis of Presentation

The accompanying  unaudited consolidated financial statements have been prepared
in  accordance  with  generally  accepted  accounting   principles  for  interim
financial information and with the instructions to Form 10-QSB of the Securities
and Exchange Commission. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting  principles for complete
financial statements.  In the opinion of management,  these financial statements
reflect all adjustments of a normal recurring nature which the Company considers
necessary for a fair presentation. The results for the three month period ending
March  31,  1998  are not  necessarily  indicative  of the  results  that may be
achieved for the entire year ending  December 31, 1998 or for any other  interim
period.

Certain  reclassifications  have been made to prior period amounts to conform to
the current period presentation.

2. Inventories

Inventories  are in two main stages of completion and consisted of the following
(amounts in thousands):
<TABLE>
<CAPTION>

                                                            March 31,        December 31,
                                                              1998               1997
                                                       -------------------------------------
                                                           (Unaudited)
<S>                                                    <C>                   <C>

Components and fabric                                           $7,236             $7,650
Jobs in process and finished goods                               2,510              3,130
                                                       -------------------------------------
                                                                $9,746            $10,780
                                                       =====================================
</TABLE>


3. Income Taxes

As a result of recent operating losses and the uncertainty of the realization of
the potential tax benefits  thereof,  the Company has not recorded the potential
income tax benefit of  $277,000  related to the  quarter  ended March 31,  1998.
Related  deferred  income tax assets of $277,000 have been offset by a valuation
allowance.  The Company  will  reevaluate  the  potential  realizability  of the
deferred tax assets on a quarterly basis.


<PAGE>

4. Indebtedness

At March 31, 1998, the Company had  outstanding  borrowongs of $2,726,000 on its
$6,000,000  line of credit.  The Company was in violation  of certain  financial
covenants  contained in the line of credit at March 31,  1998.  On May 13, 1998,
the Company and the lender  agreed that the  non-compliance  with the  financial
covenants  would be waived  for the  first  quarter  and the  amount of the line
reduced to $4,000,000.

<PAGE>
                             OPEN PLAN SYSTEMS, INC.




            Item 2: Management's Discussion and Analysis of Financial
                       Condition and Results of Operations


Results of Operations

     The following table sets forth the  relationship of costs and expenses as a
percentage of the Company's sales for the periods indicated:
<TABLE>
<CAPTION>
                                                 Three Months Ended
                                                      March 31,                           
                                                   1998        1997
<S>                                             <C>         <C> 

Net sales                                         100.0%      100.0%
Cost of sales                                      79.2        77.3
                                                ----------- ----------
Gross profit                                       20.8        22.7
Amortization of intangibles                         0.9         1.1
Selling and marketing expenses                     25.0        19.4
General and administrative expenses                 9.4        11.3
                                                ----------- ----------
Operating loss                                    (14.5)       (9.1)
Other (income) expense                              0.8         (.6)
                                                ----------- ----------
Loss before income taxes                          (15.3)       (8.5)
Benefit from income taxes                            -         (3.6)
                                                ----------- ----------
Net loss                                          (15.3)%      (4.9)%
                                                =========== ==========
</TABLE>


     Sales. Sales for the three months ended March 31, 1998 were $7,900,000,  an
increase of approximately  $1,463,000 or 22.7% over the same period in 1997. The
increase  in the first  quarter  sales  was  principally  due to sales  from the
Company's sales offices opened during 1997 as well as additional  sales from the
Company's  National  Accounts  group,  located at the Company's  headquarters in
Richmond,  Virginia.  In total, for offices open in excess of one year, seven of
the sales  offices  showed  increased  sales  during the period and five  showed
declining sales. The other three sales offices were opened during 1997.

     The Company continued to experience sales  discounting  pressure during the
most recent quarter.  This discounting  pressure came primarily from dealers and
large national  companies  served by the National  Accounts group. The Company's
sales mix continued to be skewed toward this segment of the business  during the
first quarter of 1998.  The Company is in the process of  implementing  some new
marketing  initiatives  around  its  traditional  core  customer  market  where,
historically, there has been less discounting pressure.

     During the quarter,  the Company  implemented  initiatives  surrounding the
branch office network including increased management and sales personnel levels.
The Company is also continuing to evaluate the impact that its various marketing
programs are having on sales in each market. Based on information generated from
the programs,  the Company is targeting its efforts on the most effective method
of promotion for each market.  Additionally,  the Company has added  salesmen to
branch  offices in order to increase the  visibility  and  marketing  efforts of
those offices and to increase production from these offices.

     Cost of Sales.  The Company's cost of sales includes costs of raw materials
(new and used workstation  components,  new fabric,  laminate,  paint, and other
materials), labor, supplies, freight, utilities, and other manufacturing related
expenses.  Cost of sales  increased by  $1,280,000  in the first quarter of 1998
from the $4,976,000  reported in the first quarter of 1997. The increase in cost
of sales is primarily attributable to sales volume increases.

     The gross margin decreased to 20.8% in the first quarter of 1998 from 22.7%
in the first quarter of 1997.  During 1997,  the Company used its  manufacturing
capacity to increase  work-in-process  and finished goods inventory levels based
on expected sales volumes which did not  materialize.  As a result,  the Company
had excess  levels of  inventories  of certain  parts on hand.  During the first
quarter of 1998, the Company began reducing  inventory  levels so that inventory
levels fell more in line with expected  capacity and product needs. As a result,
production  levels  decreased and the cost of goods produced  during the quarter
increased  because certain fixed costs of the Company were spread over the lower
production volume. Additionally,  the Company continued to have lower margins on
certain of its National Accounts business due to the higher  discounting  levels
and relative volume of these projects in relation to the branch office results.

     The  Company is  evaluating  initiatives  to  decrease  costs  relative  to
production such that the gross margins are more in line with  historical  levels
of 30%+. However, the Company's plans are not finalized and the Company does not
expect that any such initiatives, if implemented,  will have an immediate impact
on the gross margin.

     Operating  Expenses.  The Company's most significant  operating  expense is
selling and marketing expense.  These costs are primarily related to salesperson
compensation,  advertising and other marketing  expenses and rents.  The Company
compensates its salespeople  through a combination of salaries,  commissions and
bonuses. While most of these expenses are directly related to the current year's
sales,  certain other marketing expenses are incurred to build brand recognition
and generate sales leads that may contribute to sales in later periods.

     Selling and marketing  expenses for the first quarter of 1998  increased to
$1,972,000  from the  $1,250,000  reported  in the first  quarter  of 1997.  The
increases  were  primarily  related to adding new management and sales people in
the branch  offices,  increased  advertising  expenses  related  to  coordinated
national marketing programs and other anticipated  expenses related to providing
adequate support levels to the branch offices.
 
     The  Company  anticipates  increasing  the level of sales  people in branch
offices to the number  necessary to  effectively  implement the Company's  sales
strategy for the branch  office.  This means that  increased  selling  costs are
anticipated in the short term as these additional resources are hired.  However,
the Company expects that increased sales revenue resulting from the larger sales
staff will outpace the increases in compensation expense over the long term.

     General  and  administrative  expenses  increased  to $744,000 in the first
quarter  of 1998  from the  $728,000  reported  in the  first  quarter  of 1997.
Excluding the non-recurring costs of evaluating potential acquisition candidates
incurred  in  the  first  quarter  of  1997,   actual   expenses   increased  by
approximately  $166,000.  The primary  reasons for the increase  were  increased
compensation  expense due to the changes in  management  that  occurred over the
past two quarters, and additional corporate travel,  relocation and professional
fees associated with such changes.  The Company  anticipates  relatively  higher
levels of expenses over the next quarter and then  reductions over the remainder
of the year as  additional  programs  are  initiated  to hold these  expenses to
manageable  levels.  The Company  does expect to continue to  implement  its new
management information system over the next year.

     Other  Non-Operating  Income and  Expense.  Total other  income and expense
changed  from  income of  $37,000  for the first  quarter  of 1997 to expense of
$66,000 for the first  quarter of 1998.  The primary  reason for the decrease is
due to the Company  having  expended  the cash raised in the  Company's  initial
public  offering  in 1996 during 1997 and having to borrow on its line of credit
to fund operating expenses.

     Income  Taxes.  The  Company  recorded  no income tax benefit for the first
quarter of 1998 versus the $234,000  benefit recorded in the previous year. This
was the result of recent operating losses and the uncertainty of the realization
of the  potential  tax  benefits.  The Company  will  reevaluate  the  potential
realizability of the deferred tax assets on a quarterly basis.

Liquidity and Capital Resources

     Cash Flows from Operating Activities. Net cash used in operating activities
was $217,000 for the three months ended March 31, 1998 as compared to $1,070,000
for the  three  months  ended  March  31,  1997.  The  decrease  in cash used by
operating  activities  for the  first  quarter  of  1998  was  primarily  due to
increased  losses offset by  reductions  in  inventories  and  receivables.  The
Company's inventory reductions were anticipated as part of the Company's plan to
reduce its stock of raw  materials  and  finished  goods to more  closely  match
current and near-term  anticipated  sales  volumes.  Trade  accounts  receivable
decreased by  approximately  $300,000  during the first  quarter of 1998 even in
light of the  Company's  strong sales  volumes  during the quarter.  The Company
continues to focus on decreasing the number of days sales  outstanding and would
expect that future  changes in sales volumes will have not a direct  correlation
to changes in accounts receivable.

     Cash Flows from Investing Activities. Net cash used in investing activities
was  $328,000  for the three months ended March 31, 1998 as compared to $341,000
for the three  months  ended  March 31,  1997.  The cash used  during  the first
quarter of 1998 is due to the purchase of certain capital  equipment  related to
production  activities.  These purchases are consistent with the Company's focus
on  manufacturing   high-quality,   affordable   office  systems.   The  Company
anticipates that capital  spending for 1998 will be less than $1.0 million.  The
source of funds for anticipated  capital  spending will be funds from operations
as well as borrowings on the Company's  line of credit.  At March 31, 1998,  the
Company had borrowings of $2,726,000 under its line of credit.

     Cash  Flows from  Financing  Activities.  Net cash  provided  by  financing
activities was $585,000 during the first quarter of 1998 as compared to net cash
used by  financing  activities  of  $46,000.  This  increase  in cash flows from
financing activities for the first quarter of 1998 represented reduced principal
payments on outstanding  long-term debt and capital leases as well as short-term
borrowings on the Company's line of credit.
 
     Expected  Future  Cash  Flows.  The  Company  expects  that  cash flow from
operating  activities will increase over the next several  quarters as continued
decreases in inventory  and accounts  receivable,  along with  moderation of the
decreases in accounts payable  associated with the Company's  reduced  inventory
purchases,  should  provide  flexibility  for  the  Company's  short  term  cash
position.  The Company is also in negotiations with several financial institions
to extend and  increase  it's line of credit  which will  provide it  additional
flexibility  to manage  its cash  position  and to fund any amount  which  might
become due and payable under the terms of the TFM acquisition agreement.


Seasonality and Impact of Inflation

     Prior to 1997, the Company experienced lower net sales levels in the second
and third  quarters  of the year and  increased  levels in the first and  fourth
quarters.  The Company  continues  to grow  rapidly and, as the result of adding
additional sales offices and sales people during the past year and one-half, the
Company  sales  results  in 1997  and  1998  may not  reflect  similar  seasonal
variations.  Because the Company recognizes revenues upon shipment and typically
ships workstations  within three weeks of an order, a substantial portion of the
Company's  revenues in each  quarter  results  from orders  placed by  customers
during that quarter. As a result, the Company's results may vary from quarter to
quarter.

     Inflation  has not had a  material  impact  on the  Company's  net sales or
income to date. However,  there can be no assurances that the Company's business
will not be affected in the future by inflation.

Forward-Looking Statements

     The foregoing discussion contains certain forward-looking statements, which
may be identified  by phrases such as "the Company  expects" or words of similar
effect.  The Private  Securities  Litigation  Reform Act of 1995 provides a safe
harbor for  forward-looking  statements.  The  Company  has  identified  certain
important  factors  that in some cases have  affected,  and in the future  could
affect,  the  Company's  actual  results  and could cause the  Company's  actual
results for fiscal 1998 and any interim period to differ  materially  from those
expressed or implied in any forward-looking statements made by, or on behalf of,
the  Company.  These  factors are set forth  under the caption  "Forward-Looking
Statements"  in Item 6 of the  Company's  Form  10-KSB for the fiscal year ended
December 31, 1997, a copy of which is on file with the  Securities  and Exchange
Commission.  The  Company  assumes no duty to update any of the  forward-looking
statements of this report.


<PAGE>

                             OPEN PLAN SYSTEMS, INC.

                                     PART II
                                OTHER INFORMATION

Item 1.       Legal Proceedings

              None

Item 2.       Changes in Securities and Use of Proceeds

              Not Applicable

Item 3.       Defaults upon Senior Securities

              In the first quarter of 1998,  the  Company  was  in  violation of
              certain financial covenants contained in its bank line of  credit.
              These defaults were waived by the bank on May 13, 1998.  See  Note
              4 to the Notes to the Consolidated Financial Statements set  forth
              elsewhere in this report.

Item 4.       Submission of Matters to a Vote of Security Holders

              Not Applicable

Item 5.       Other Information

              Not Applicable

Item 6.       Exhibits and Reports on Form 8-K

              (a)   Exhibits:

              The registrant has included the following exhibits pursuant to 
              Item 601 of Regulation S-B.
<TABLE>
<CAPTION>

                  Exhibit No.    Description
                ---------------- --------------------------------------------------------------
                <S>              <C> 
                      3(ii)      Amended and Restated Bylaws of Open Plan Systems, Inc.

                      11         Statement Re: Computation of Per Share Earnings

                      27         Financial Data Schedule (filed electronically only)
 
              (b)  Reports on Form 8-K

                  None
</TABLE>

<PAGE>
                             OPEN PLAN SYSTEMS, INC.

                                   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.



                                                         OPEN PLAN SYSTEMS, INC.
                          ------------------------------------------------------

                                                                    (Registrant)


Date:      May 14, 1998                          /s/ Paul A. Covert
                          ------------------------------------------------------
                                                     Paul A. Covert
                                                        President



Date:      May 14, 1998                         /s/ Gary M. Farrell
                          ------------------------------------------------------
                                                    Gary M. Farrell
                                                Chief Financial Officer



Date:      May 14, 1998                        /s/ Neil F. Suffa
                          ------------------------------------------------------
                                                   Neil F. Suffa
                                               Corporate Controller


<PAGE>

                                         OPEN PLAN SYSTEMS, INC.

                                              EXHIBIT INDEX

<TABLE>
<CAPTION>

             Exhibit No.       Description
             ----------------- ------------------------------------------------------------------------
             <S>               <C>

             3(ii)             Amended and Restated Bylaws of Open Plan Systems, Inc.

             11                Statement Re: Computation of Per Share Earnings

             27                Financial Data Schedule (filed electronically only)


</TABLE>