<PAGE>

                                   FORM 10-Q
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549


/X/  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934
     
     For the quarterly period ended              June 30, 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 number        0-04781
                            -------------------

                              MARKET FACTS, INC.
             -----------------------------------------------------
            (Exact name of registrant as specified in its charter)

            Delaware                                    36-2061602
   ------------------------------                   -------------------
  (State or other jurisdiction of                    (I.R.S. Employer
   incorporation or organization)                   Identification No.)

3040 West Salt Creek Lane, Arlington Heights, Illinois         60005
------------------------------------------------------       ----------
      (Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code      (847) 590-7000
                                                  -------------------------


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  / /

INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE REGISTRANT'S CLASSES 
OF COMMON STOCK, AS OF THE LATEST PRACTICABLE DATE.

       8,858,308 common shares as of August 3, 1998
----------------------------------------------------------------

<PAGE>

                        PART I - FINANCIAL INFORMATION
                                       
ITEM 1. FINANCIAL STATEMENTS.

                                       
                      MARKET FACTS, INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                   AS OF JUNE 30, 1998 AND DECEMBER 31, 1997

                                      ASSETS
<TABLE>
<CAPTION>

                                                                      June 30,     December 31,
                                                                        1998           1997
                                                                     -----------   ------------
<S>                                                                  <C>           <C>
 CURRENT ASSETS:
  Cash and cash equivalents                                          $19,428,425   $36,444,256
  Certificate of deposit                                                  50,000        50,000
  Accounts receivable:
   Trade, less allowance for doubtful accounts of
   $1,203,835 in 1998 and $1,101,551 in 1997                          24,001,007     20,085,658
   Other                                                                  96,793         60,189
  Notes receivable                                                        12,480        188,844
  Revenues earned on contracts in progress
   in excess of billings                                               5,165,322      4,618,736
  Deferred income taxes                                                1,135,364      1,136,254
  Prepaid expenses and other assets                                      632,958        514,323
                                                                     -----------   ------------
      Total Current Assets                                            50,522,349     63,098,260
                                                                     -----------   ------------

 PROPERTY, AT COST                                                    33,379,090     30,356,209
  Less accumulated depreciation and amortization                     (14,608,608)   (13,274,711)
                                                                     -----------   ------------
      Net Property                                                    18,770,482     17,081,498
                                                                     -----------   ------------

 OTHER ASSETS:
  Goodwill and other intangibles, net of accumulated amortization
   of $526,453 in 1998 and $229,772 in 1997                           21,651,250      4,959,752
  Deferred income taxes, noncurrent                                    1,143,432      1,063,833
  Investment in affiliated companies                                     478,404        688,404
                                                                     -----------   ------------
      Total Other Assets                                              23,273,086      6,711,989
                                                                     -----------   ------------

      Total Assets                                                   $92,565,917    $86,891,747
                                                                     -----------   ------------
                                                                     -----------   ------------
</TABLE>

 See accompanying notes to condensed consolidated financial statements.


                                    Page 1

<PAGE>

                      MARKET FACTS, INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                   AS OF JUNE 30, 1998 AND DECEMBER 31, 1997


                     LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>

                                                                                  June 30,     December 31,
                                                                                    1998           1997
                                                                                ------------   ------------
<S>                                                                             <C>            <C>
 CURRENT LIABILITIES:
  Accrued expenses                                                              $  9,260,101   $ 10,052,639
  Billings in excess of revenues earned
   on contracts in progress                                                       10,296,446      9,267,185
  Accounts payable                                                                 3,525,507      2,380,596
  Income taxes                                                                     1,241,330        945,449
  Current portion of obligations under capital leases                                160,321        154,991
  Current portion of long-term debt                                                  136,546        136,546
                                                                                ------------   ------------
      Total Current Liabilities                                                   24,620,251     22,937,406
                                                                                ------------   ------------

 LONG-TERM LIABILITIES:
  Long-term debt                                                                  10,092,486     10,159,110
  Obligations under capital leases, noncurrent portion                               830,530        249,978
                                                                                ------------   ------------
      Total Long-Term Liabilities                                                 10,923,016     10,409,088
                                                                                ------------   ------------
      Total Liabilities                                                           35,543,267     33,346,494
                                                                                ------------   ------------

 STOCKHOLDERS' EQUITY:
  Preferred stock, no par value; 500,000 shares authorized;
   Series A - none issued; Series B - 100 shares issued                                   --             --
  Common stock, $1 par value; 15,000,000 shares authorized; 10,890,458 shares
   issued as of June 30, 1998 and 10,875,258 as of December 31, 1997              10,890,458     10,875,258
  Capital in excess of par value                                                  44,758,642     44,707,038
  Cumulative foreign currency translation                                           (171,249)      (133,632)
  Retained earnings                                                               16,084,600     12,672,160
                                                                                ------------   ------------
                                                                                  71,562,451     68,120,824

  Less 2,042,550 shares of treasury common stock at cost                         (13,891,966)   (13,891,966)
  Less other transactions involving common stock                                    (647,835)      (683,605)
                                                                                ------------   ------------
      Total Stockholders' Equity                                                  57,022,650     53,545,253
                                                                                ------------   ------------
      Total Liabilities and Stockholders' Equity                               $  92,565,917   $ 86,891,747
                                                                                ------------   ------------
                                                                                ------------   ------------
</TABLE>
 See accompanying notes to condensed consolidated financial statements.


                                    Page 2

<PAGE>

                      MARKET FACTS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
               FOR THE THREE MONTHS ENDED JUNE 30, 1998 AND 1997

<TABLE>
<CAPTION>
                                                      Three Months Ended June 30,
                                                    -----------------------------
                                                         1998            1997
                                                    -------------    ------------
<S>                                                 <C>              <C>
 REVENUE                                            $  34,165,477    $ 25,253,225
                                                    -------------    ------------
 DIRECT COSTS:
  Payroll                                               6,360,715       4,581,962
  Other expenses                                       12,709,160       9,503,515
                                                    -------------    ------------
    Total                                              19,069,875      14,085,477
                                                    -------------    ------------
    Gross Margin                                       15,095,602      11,167,748
                                                    -------------    ------------
 OPERATING EXPENSES:
  Selling                                               1,129,597         848,144
  General and administrative                           10,499,879       8,206,736
                                                    -------------    ------------
    Total                                              11,629,476       9,054,880
                                                    -------------    ------------
    Income from Operations                              3,466,126       2,112,868
                                                    -------------    ------------
 OTHER INCOME (EXPENSE):
  Interest expense                                      (285,708)        (264,461)
  Interest income                                         187,057           9,796
  Other income, net                                       122,748          33,393
                                                    -------------    ------------
    Total                                                  24,097        (221,272)
                                                    -------------    ------------
 Income Before Provision For Income Taxes               3,490,223       1,891,596
 Provision For Income Taxes                             1,469,190         811,025
                                                    -------------    ------------
 NET INCOME                                         $   2,021,033    $  1,080,571
                                                    -------------    ------------
                                                    -------------    ------------

 BASIC EARNINGS PER SHARE                           $         .23    $        .16
                                                    -------------    ------------
                                                    -------------    ------------

 DILUTED EARNINGS PER SHARE                         $         .22    $        .15
                                                    -------------    ------------
                                                    -------------    ------------
</TABLE>

 See accompanying notes to condensed consolidated financial statements.


                                    Page 3

<PAGE>

                      MARKET FACTS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997

<TABLE>
<CAPTION>
                                                      Six Months Ended June 30,
                                                         1998          1997
                                                    ------------- -------------
<S>                                                 <C>           <C>
 REVENUE                                            $  63,410,758 $  46,834,647
 DIRECT COSTS:
  Payroll                                              11,703,254     8,620,032
  Other expenses                                       23,963,198    17,316,313
                                                    ------------- -------------
    Total                                              35,666,452    25,936,345
                                                    ------------- -------------
    Gross Margin                                       27,744,306    20,898,302
                                                    ------------- -------------
 OPERATING EXPENSES:
  Selling                                               2,261,275     1,584,631
  General and administrative                           19,649,818    15,503,307
                                                    ------------- -------------
    Total                                              21,911,093    17,087,938
                                                    ------------- -------------
    Income from Operations                              5,833,213     3,810,364
                                                    ------------- -------------
 OTHER INCOME (EXPENSE):
  Interest expense                                       (566,970)     (542,861)
  Interest income                                         518,594        32,245
  Other income, net                                       133,571        46,911
                                                    ------------- -------------
    Total                                                  85,195      (463,705)
                                                    ------------- -------------
 Income Before Provision For Income Taxes               5,918,408     3,346,659
 Provision For Income Taxes                             2,505,968     1,431,466
                                                    ------------- -------------
 NET INCOME                                          $  3,412,440  $  1,915,193
                                                    ------------- -------------
                                                    ------------- -------------

 BASIC EARNINGS PER SHARE                            $        .39  $        .28
                                                    ------------- -------------
                                                    ------------- -------------

 DILUTED EARNINGS PER SHARE                          $        .37  $        .27
                                                    ------------- -------------
                                                    ------------- -------------
</TABLE>
 See accompanying notes to condensed consolidated financial statements.


                                    Page 4

<PAGE>

                      MARKET FACTS, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997

<TABLE>
<CAPTION>
                                                                      Six Months Ended June 30,
                                                                        1998             1997
                                                                    ------------     ------------
<S>                                                                 <C>              <C>
 CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                                                        $  3,412,440     $  1,915,193
  Adjustments to reconcile net income to net cash provided by
  operating activities:
   Depreciation and amortization                                       1,903,093        1,577,068
   Deferred income taxes                                                 (80,311)              --
   Vesting of restricted stock and demand notes receivable                23,757           27,717
   Net gain on disposal of property                                      (89,746)          (9,805)
   Change in assets and liabilities:
    Accounts receivable                                               (3,331,971)        (509,002)
    Prepaid expenses and other assets                                   (195,186)         (53,142)
    Billings in excess of (less than) revenues earned 
    on contracts in progress                                            (108,556)         533,441
    Accounts payable and accrued expenses                               (745,204)         133,037
    Income taxes                                                         297,321         (745,032)
                                                                    ------------     ------------
        Net cash provided by operating activities                      1,085,637        2,869,475
                                                                    ------------     ------------
 CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisition of businesses, net of acquired cash                    (15,592,471)              --
  Purchases of property                                               (2,451,680)      (1,172,815)
  Proceeds from the sale of property                                          --            9,805
  Investment in notes receivable                                              --         (150,000)
  Proceeds from notes receivable                                         188,377           91,316
                                                                    ------------     ------------
        Net cash used in investing activities                        (17,855,774)      (1,221,694)
                                                                    ------------     ------------
 CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayment of short-term borrowings                                  (6,655,712)      (5,398,936)
  Proceeds from short-term borrowings                                  6,505,712        4,479,832
  Reduction of obligations under capital leases and 
  long-term debt                                                        (155,480)        (372,703)
  Proceeds from exercise of stock options                                 66,804               --
                                                                    ------------     ------------
        Net cash used in financing activities                           (238,676)      (1,291,807)
                                                                    ------------     ------------
 EFFECT OF EXCHANGE RATE CHANGES ON CASH                                  (7,018)            (894)
                                                                    ------------     ------------
 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                (17,015,831)         355,080
 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                     36,444,256          129,428
                                                                    ------------     ------------
 CASH AND CASH EQUIVALENTS AT END OF PERIOD                         $ 19,428,425     $    484,508
                                                                    ------------     ------------
                                                                    ------------     ------------
 CASH PAID DURING THE PERIOD FOR:
  Interest                                                          $    560,692     $    550,656
  Income taxes, net of refunds                                         2,286,386        2,176,348
                                                                    ------------     ------------
                                                                    ------------     ------------
 SUPPLEMENTAL SCHEDULE OF NON CASH ACTIVITIES:
  Capital lease obligation incurred on lease of equipment           $    643,132     $         --
                                                                    ------------     ------------
                                                                    ------------     ------------
</TABLE>

 See accompanying notes to condensed consolidated financial statements.


                                    Page 5

<PAGE>

NOTES TO FINANCIAL STATEMENTS

NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of 
Market Facts, Inc. and Subsidiaries ("Company") have been prepared in 
accordance with the instructions to Form 10-Q.  The results of operations for 
interim periods are not necessarily indicative of the results to be expected 
for the entire year.  For further information regarding the Company's most 
recently completed fiscal year, refer to the consolidated financial 
statements included in the Company's Annual Report on Form 10-K for the year 
ended December 31, 1997.

NOTE 2 - ADJUSTMENTS AND RECLASSIFICATIONS

The information furnished herein includes all adjustments, consisting of 
normal recurring adjustments, which are, in the opinion of management, 
necessary for a fair presentation of the interim financial statements.

NOTE 3 - REVENUE RECOGNITION

The Company recognizes revenue under the percentage of completion method of 
accounting.  Revenue on client projects is recognized as services are 
performed.  Losses expected to be incurred on jobs in progress are charged to 
income as soon as such losses are known.  Revenue earned on contracts in 
progress in excess of billings is classified as a current asset.  Amounts 
billed in excess of revenue earned are classified as a current liability. 
Client projects are expected to be completed within a twelve month period.

NOTE 4 - EARNINGS PER SHARE

Reconciliations of the numerators and denominators of the basic and diluted 
earnings per share computations for the three and six months ended June 30, 
1998 and 1997, respectively are as follows:

<TABLE>
<CAPTION>
                                                           Three Months Ended June 30, 1998
                                                       ----------------------------------------
                                                                                      Per Share
                                                         Income         Shares          Amount
                                                       ----------      ---------      ---------
<S>                                                    <C>             <C>            <C>
Basic Earnings Per Share
   Net income                                          $2,021,033      8,843,908        $  .23
                                                                                      ---------
                                                                                      ---------
Effect of Dilutive Securities
   Stock options                                           --            342,905
                                                       ----------      ---------
Diluted Earnings Per Share
   Income available to common stockholders
      plus assumed conversions                         $2,021,033      9,186,813        $  .22
                                                       ----------      ---------      ---------
                                                       ----------      ---------      ---------
</TABLE>


                                    Page 6

<PAGE>

<TABLE>
<CAPTION>
                                                             Six Months Ended June 30, 1998
                                                       ----------------------------------------
                                                                                      Per Share
                                                         Income         Shares          Amount
                                                       ----------      ---------      ---------
<S>                                                    <C>             <C>            <C>
Basic Earnings Per Share
   Net income                                          $3,412,440      8,839,448       $  .39
                                                                                      ---------
                                                                                      ---------
Effect of Dilutive Securities
   Stock options                                           --            328,651
                                                       ----------      ---------
Diluted Earnings Per Share
   Income available to common stockholders
      plus assumed conversions                         $3,412,440      9,168,099       $  .37
                                                       ----------      ---------      ---------
                                                       ----------      ---------      ---------
</TABLE>

<TABLE>
<CAPTION>

                                                           Three Months Ended June 30, 1997
                                                       ----------------------------------------
                                                                                      Per Share
                                                        Income          Shares          Amount
                                                       ----------      ---------      ---------
<S>                                                    <C>             <C>            <C>
Basic Earnings Per Share
   Net income                                          $1,080,571      6,923,708        $  .16
                                                                                      ---------
                                                                                      ---------
Effect of Dilutive Securities
   Stock options                                           --            238,523
                                                       ----------      ---------
Diluted Earnings Per Share
   Income available to common stockholders
      plus assumed conversions                         $1,080,571      7,162,231        $  .15
                                                       ----------      ---------      ---------
                                                       ----------      ---------      ---------
</TABLE>

<TABLE>
<CAPTION>
                                                             Six Months Ended June 30, 1997
                                                       ----------------------------------------
                                                                                      Per Share
                                                         Income         Shares          Amount
                                                       ----------      ---------      ---------
<S>                                                    <C>             <C>            <C>
Basic Earnings Per Share
   Net income                                          $1,915,193      6,923,708        $  .28
                                                                                      ---------
                                                                                      ---------
Effect of Dilutive Securities
   Stock options                                           --            214,480
                                                       ----------      ---------
Diluted Earnings Per Share
   Income available to common stockholders
      plus assumed conversions                         $1,915,193      7,138,188        $  .27
                                                       ----------      ---------      ---------
                                                       ----------      ---------      ---------
</TABLE>


                                    Page 7

<PAGE>

NOTE 5 - COMPREHENSIVE INCOME

Effective January 1, 1998, the Company adopted Statement of Financial 
Accounting Standards No. 130, "Reporting Comprehensive Income" which 
establishes standards to report and display comprehensive income and its 
components in a full set of general purpose financial statements. The 
Company's comprehensive income was as follows:

<TABLE>
<CAPTION>
                                                 Three Months Ended June 30,
                                                 ---------------------------
                                                    1998             1997
                                                 ----------       ----------
<S>                                              <C>              <C>
   Net income                                    $2,021,033       $1,080,571
   Other comprehensive income:
    Foreign currency translation adjustments     $  (48,367)      $    3,328
                                                 ----------       ----------
   Comprehensive income                          $1,972,666       $1,083,899
                                                 ----------       ----------
                                                 ----------       ----------
</TABLE>

<TABLE>
<CAPTION>
                                                  Six Months Ended June 30,
                                                 ---------------------------
                                                    1998             1997
                                                 ----------       ----------
<S>                                              <C>              <C>
   Net income                                    $3,412,440       $1,915,193
   Other comprehensive income:
    Foreign currency translation adjustments     $  (37,617)      $  (10,421)
                                                 ----------       ----------
   Comprehensive income                          $3,374,823       $1,904,772
                                                 ----------       ----------
                                                 ----------       ----------
</TABLE>

Note 6 - Acquisition of Strategy Research Corporation

On January 1, 1998, the Company acquired the remaining 90% of the outstanding 
stock of Strategy Research Corporation ("Strategy Research").  Prior to 1998, 
the Company held a 10% interest in Strategy Research.  Strategy Research is a 
full service market research company specializing in the Latin American and 
U.S. Hispanic markets. The purchase price was an amount equal to (i) 
$1,192,000 in cash paid at closing, (ii) the assumption of $150,000 of bank 
debt, and (iii) up to $1,950,000 of possible contingent payments based on 
Strategy Research exceeding certain earnings targets for 1998 and 1999. The 
acquisition was accounted for under the purchase method of accounting. The 
excess of the purchase price over the fair values of the assets acquired and 
liabilities assumed of $1,416,012 has been recorded as goodwill and is being 
amortized on a straight-line basis over 25 years. This preliminary allocation 
of purchase price is subject to further adjustments; however, the Company 
does not expect the estimated values to change materially upon finalization 
of the allocation of the purchase price. The operating results of Strategy 
Research have been included in the consolidated statements of earnings and 
cash flows since the date of acquisition.


                                    Page 8

<PAGE>

NOTE 7 - ACQUISITION OF TANDEM RESEARCH ASSOCIATES, INC.

On March 31, 1998, TRA Acquisition Corp. ("TRA"), a wholly-owned subsidiary 
of the Company, acquired certain assets and assumed certain liabilities of 
Tandem Research Associates, Inc. ("Tandem Research"), a 16 year-old firm 
providing specialized custom and multi-client research products and services 
to leading pharmaceutical companies and emerging biotech firms. The purchase 
price was an amount equal to (i) $14,424,000 in cash paid at closing, (ii) 
the assumption of approximately $590,000 of customer deposit liabilities, and 
(iii) additional contingent payments based on TRA exceeding certain earnings 
targets for the period April 1, 1998 through March 31, 2001 (the "Additional 
Purchase Price"). The Additional Purchase Price equals (i) 3.25 multiplied by 
the amount by which TRA's aggregate earnings before interest and income taxes 
("EBIT") during each year in the three-year period after the closing exceeds 
certain specified amounts, up to a maximum aggregate payment of $9,000,000, 
plus (ii) fifty percent of TRA's aggregate EBIT during the three-year period 
after the closing in excess of $9,931,000. At the election of Tandem 
Research, up to twenty-five percent of the Additional Purchase Price may be 
payable in shares of the Company's common stock.

The acquisition was accounted for under the purchase method of accounting. 
The excess of the purchase price over the fair values of the assets acquired 
and liabilities assumed of $15,397,167 has been recorded as goodwill and is 
being amortized on a straight-line basis over 25 years. This preliminary 
allocation of purchase price is subject to further adjustments; however, the 
Company does not expect the estimated values to change materially upon 
finalization of the allocation of the purchase price.  The operating results 
of TRA have been included in the consolidated statements of earnings and cash 
flows since the date of acquisition.

The following unaudited pro forma financial information is provided for the 
six months ended June 30, 1998 and 1997 as though the acquisition had taken 
place at the beginning of the periods being reported on:

<TABLE>
<CAPTION>
                                   Six Months Ended June 30,
                                     1998             1997
                                  ------------    ------------
<S>                               <C>             <C>
   Revenue                        $ 64,750,704    $ 49,976,402
   Net Income                     $  3,764,210    $  2,752,418
   Basic Earnings Per Share       $        .43    $        .40
   Diluted Earnings Per Share     $        .41    $        .39
</TABLE>

The pro forma financial results do not necessarily reflect actual results 
which may have occurred if the acquisition had taken place at the beginning 
of the periods being reported on, nor are they necessarily indicative of the 
results of future combined operations.


                                    Page 9

<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
RESULTS OF OPERATIONS.

LIQUIDITY AND CAPITAL RESOURCES

The Company's liquidity depends primarily upon its net income, accounts 
receivable, accounts payable and accrued expenses.  Historically, the Company 
has financed its operations through cash generated from operating activities 
and bank lines of credit.  In October 1997, the Company generated $36.9 
million in net proceeds from a public offering of its common stock.  The 
Company intends to continue using the remaining net proceeds as working 
capital and for general corporate purposes, including acquisitions, 
investments in technology, new product development and joint ventures.

During the first six months of 1998, cash and cash equivalents decreased by 
$17.0 million.  The decrease was due primarily to the acquisitions of Tandem 
Research and Strategy Research.  Net cash provided by operating activities 
was $1.1 million in the first six months of 1998 compared to $2.9 million in 
the same period in 1997.  The decrease was due primarily to the timing of 
billings partially offset by increased net income. Cash used in investing 
activities was $17.9 million in the first six months of 1998 compared to $1.2 
million in the same period in 1997.  The increase in cash used was due 
primarily to the acquisitions of Tandem Research and Strategy Research and 
increased purchases of property primarily relating to investments in 
technology. Cash used in financing activities was $0.2 million in the first 
six months of 1998 compared to $1.3 million in the same period in 1997.  The 
decrease in cash used was due primarily to higher net repayments of 
short-term borrowings in 1997.

The Company has available borrowings under established bank credit facilities 
totaling $13.7 million.  There were no borrowings outstanding under these 
arrangements at June 30, 1998 and December 31, 1997.

The Company believes that the net proceeds from the 1997 public offering of 
its common stock, cash flow from operations and borrowings available from its 
bank credit facilities will be sufficient to meet its working capital 
expenditure requirements for the foreseeable future. It is the Company's 
intention to continue to pursue acquisition opportunities as a means to grow, 
and these acquisitions may require an amount of capital that exceeds that 
available from the proceeds of the 1997 public offering, cash from operations 
and existing bank arrangements.

RESULTS OF OPERATIONS
COMPARISON OF SECOND QUARTER 1998 TO SECOND QUARTER 1997

The Company had second quarter revenue of $34.2 million in 1998, an increase 
of 35.3% over the same period in 1997.  The increase in revenue was due 
primarily to the impact of acquisitions made during the past twelve months, 
continued expansion of marketing research services within the Company's 
existing client base and the addition of clients for whom the Company did not 
perform any research services during the previous fiscal year.

Gross margin for the second quarter of 1998 was $15.1 million, an increase of 
35.2% over the same period in 1997. The increase in gross margin was 
primarily due to the growth in revenue. Gross margin as a percentage of 
revenue remained constant at 44.2%.

Operating expenses for the second quarter of 1998 rose by $2.6 million, an 
increase of 28.4% compared to the same period in 1997. The increase in 
operating expenses was due primarily to the inclusion of operating expenses 
for the acquisitions made during the past twelve months and higher marketing 
staff expenses to support the growth in business.  Operating expenses as a 
percentage of revenue decreased during the second quarter of 1998 to 34.0% 
from 35.9% for the same period in 1997.

Other income increased $0.2 million during the second quarter of 1998 due to 
interest earned on the remaining proceeds from the 1997 public offering.


                                    Page 10

<PAGE>

Net income rose 87.0% to $2.0 million or 5.9% of revenue compared to $1.1 
million or 4.3% of revenue during the same period in 1997. Basic earnings per 
share increased 43.8% to $.23 for the second quarter of 1998 compared to $.16 
for the same period in 1997.  Diluted earnings per share increased 46.7% to 
$.22 for the second quarter of 1998 compared to $.15 for the same period in 
1997.

COMPARISON OF FIRST SIX MONTHS OF 1998 TO FIRST SIX MONTHS OF 1997

During the first six months of 1998, the Company had revenue of $63.4 
million, an increase of 35.4% over the same period in 1997.  The increase in 
revenue was due primarily to the impact of acquisitions made during the past 
twelve months, continued expansion of marketing research services within the 
Company's existing client base and the addition of clients for whom the 
Company did not perform any research services during the previous fiscal year.

Gross margin for the first six months of 1998 was $27.7 million, an increase 
of 32.8% over the same period in 1997. The increase in gross margin was 
primarily due to the growth in revenue. Gross margin as a percentage of 
revenue was 43.8% compared to 44.6% in 1997.

Operating expenses for the first six months of 1998 rose by $4.8 million, an 
increase of 28.2% compared to the same period in 1997. The increase in 
operating expenses was due primarily to the inclusion of operating expenses 
for the acquisitions made during the past twelve months, higher marketing 
staff expenses to support the growth in business and increased spending to 
grow the Consumer Mail Panel. Operating expenses as a percentage of revenue 
decreased during the first six months of 1998 to 34.6% from 36.5% for the 
same period in 1997.

Other income increased $0.5 million during the first six months of 1998 due 
to interest earned on the remaining proceeds from the 1997 public offering.

Net income for the first six months of 1998 rose 78.2% to $3.4 million or 
5.4% of revenue compared to $1.9 million or 4.1% of revenue during the same 
period in 1997. Basic earnings per share increased 39.3% to $.39 for the 
first six months of 1998 compared to $.28 for the same period in 1997.  
Diluted earnings per share increased 37.0% to $.37 for the first six months 
of 1998 compared to $.27 for the same period in 1997.

YEAR 2000

The Company is aware of issues associated with the programming code in 
existing computer systems as the year 2000 approaches.  The Company is 
utilizing both internal and external resources to identify, correct or 
reprogram, and test its systems for Year 2000 compliance.  Management is in 
the process of assessing the Year 2000 compliance expense and the related 
potential effect on the Company's earnings.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.


                                    Page 11

<PAGE>

                          PART II - OTHER INFORMATION


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

(a)  The Annual Stockholders' Meeting of the Company was held on April 30, 
     1998.

(c)  At the Annual Stockholders' Meeting, the Stockholders voted to elect three
     directors of the Company in an uncontested election, and to approve an
     amendment to the Market Facts, Inc. 1996 Stock Plan to increase the 
     aggregate number of shares of Common Stock that may be issued pursuant to 
     the Plan from 1,000,000 to 1,800,000.  The results of the voting are 
     stated below.

     (1)      the proposal to elect three directors of the Company:

<TABLE>
                                                    Against
                                        For       Or Withheld
                                      ---------   -----------
        <S>                           <C>         <C>
        William W. Boyd*              8,056,192     36,220
        Timothy J. Sullivan*          8,047,526     44,886
        Jeffery A. Oyster**                 100          0
</TABLE>
    
    (2)  the proposal to amend the Market Facts, Inc. 1996 Stock Plan:

<TABLE>
<CAPTION>
                                            Broker
            For       Against   Abstain    Non-Vote
         ---------    -------   -------    --------
         <S>          <C>       <C>        <C>
         6,228,872    990,214    37,690     845,848
</TABLE>

    *          elected by the holders of Common Stock
    **         elected by the holder of Series B Preferred Stock

ITEM 5.  OTHER INFORMATION.

FORWARD-LOOKING STATEMENTS

Certain statements made from time to time by the Company, including 
statements in the Management's Discussion and Analysis section above, 
constitute "forward-looking statements" made in reliance upon the safe harbor 
contained in Section 21E of the Securities Exchange Act of 1934, as amended.  
Such forward-looking statements include those relating to growth through 
acquisition opportunities and statements relating to the Company or its 
operations that are preceded by terms such as "expects," "believes," 
"anticipates," "intends" and similar expressions. Such forward-looking 
statements are not guarantees of future performance and involve risks and 
uncertainties. The Company's actual results, performance or achievements 
could differ materially from the results, performance or achievements 
expressed in, or implied by, these forward-looking statements as a result of 
various factors, including without limitation, the following:

RELIANCE ON KEY CLIENTS.  The Company's five largest clients accounted for 
approximately 26%, 26% and 25% of the Company's total revenues in 1995, 1996 
and 1997, respectively, with one client, Procter & Gamble, accounting for 
12%, 10% and 11%, respectively, of such revenues. The Company generally does 
not enter into long-term contracts with its clients, but operates on a 
project-by-project basis.  For most of its clients, the Company is not the 
exclusive provider of market research services and, therefore, such clients 
could decrease the amount of research projects awarded to the Company at any 
time. Although approximately 90% of the Company's revenue in 1997 was from 
clients for whom the Company had performed work in the previous year, the 
loss of one or more of the Company's largest clients, or a significant 
reduction in business from such clients could have a material adverse effect 
on the Company.


                                    Page 12

<PAGE>

FLUCTUATIONS IN DEMAND FOR MARKET RESEARCH.  Demand for the Company's 
research services can be affected by a number of factors outside the 
Company's control, including fluctuations in clients' marketing budgets, 
changes in economic conditions, consolidation and other industry trends and 
changes in the management or ownership of a client. In addition, a client's 
market research activities are often dependent on the timing of its new 
product introductions and reformulations. As a result of such factors, the 
amount of market research conducted by the Company for each of its clients 
has varied in the past and is likely to continue to vary from quarter to 
quarter in the future. These variations can contribute to fluctuations in the 
Company's operating results from period to period.

VARIABILITY OF QUARTERLY OPERATING RESULTS.  The Company's revenues and 
earnings may fluctuate from quarter to quarter based on such factors as the 
number, size and scope of projects in which the Company is engaged, the terms 
and degree of completion of such projects, expenditures required by the 
Company in connection with such projects, any delays incurred in connection 
with such projects, employee utilization rates, the adequacy of provisions 
for losses, the accuracy of estimates of resources required to complete 
ongoing projects, and general economic conditions.

RISKS ASSOCIATED WITH ACQUISITIONS AND FAILURE TO INTEGRATE ACQUIRED 
BUSINESSES; LIMITED PRIOR ACQUISITION EXPERIENCE.  The Company has recently 
completed several acquisitions and intends to continue expanding through 
acquisitions as part of its business strategy. However, there is significant 
competition for attractive acquisition candidates, and there can be no 
assurance that the Company will be able to identify and acquire attractive 
acquisition candidates.

Additionally, the Company has had limited prior experience regarding 
acquisitions, and there can be no assurance that the Company will be able to 
profitably manage acquired companies or successfully integrate such acquired 
companies without substantial costs, delays or other problems. Successful 
integration of the recent acquisitions will require the experience and 
expertise of the senior management teams of the acquired companies, which are 
expected to remain with the Company. There can be no assurance that the 
members of senior management will remain with the Company for the time period 
necessary to successfully integrate the recent acquisitions. Future 
acquisitions may entail the payment of consideration in excess of book value, 
may result in the issuance of additional shares of common stock or the 
incurrence of additional indebtedness by the Company, and could have a 
dilutive effect on the earnings or book value per share of common stock.

COMPETITION.  The custom market research industry is highly fragmented. The 
Company faces direct competition from a large number of relatively small 
organizations that serve niche markets but lack the capability to provide a 
full range of products and services. Although the Company estimates that it 
is among the six largest custom market research firms in the United States, 
as measured by 1997 revenue, it faces direct competition from a small number 
of larger concerns with resources greater than those of the Company. The 
Company believes that as the industry continues to consolidate, it will face 
increasing competition from these concerns not only for clients but also for 
acquisition candidates. Furthermore, the Company is subject to competition 
from the marketing research departments of clients and potential clients, 
advertising agencies and survey research departments affiliated with 
universities and government agencies.

The Company believes that the principal methods of competition are quality 
and speed of research results, the ability to provide customized data 
collection, analysis and interpretation, geographic coverage, the ability to 
guide clients through the entire marketing research process, the ability to 
provide creative recommendations to clients and the ability to attractively 
price its services. The Company believes that its ability to properly design 
research projects and deliver quality research results quickly, and to 
customize its projects and guide its clients through the entire marketing 
research process are competitive strengths. The Company also believes that 
the ability to service the international research needs of clients has become 
an increasingly important competitive factor.


                                    Page 13

<PAGE>

ABILITY TO CONTINUE COMPANY GROWTH; MANAGEMENT OF GROWTH.  For the three-year 
period ended December 31, 1997, the Company's revenue and net income 
increased at a compound annual growth rate of 22% and 60%, respectively.  
There can be no assurance that the Company will be able to sustain its recent 
increases in operating results. Furthermore, if the Company continues to 
grow, there can be no assurance that management will be effective in 
attracting and retaining additional qualified personnel, expanding the 
Company's physical facilities, updating the Company's systems, procedures and 
controls, integrating any acquired businesses or otherwise managing growth. 
Any inability to manage growth effectively could have a material adverse 
effect on the Company's business, financial condition and results of 
operations.

RISKS OF INTERNATIONAL EXPANSION.  An important part of the Company's 
business strategy is to be able to provide market research products and 
services to its clients globally and it intends to continue seeking 
acquisitions, joint ventures and strategic alliances globally to enhance its 
existing capabilities. The international operations of the Company and of its 
international joint ventures are subject to numerous challenges and risks 
inherent in conducting business internationally, including maintenance of an 
international data collection network that adheres to the Company's quality 
standards, currency control laws, fluctuations in exchange rates, political 
turmoil, war, foreign economic conditions, tariffs and other trade barriers, 
longer accounts receivable collection cycles and potentially adverse tax 
consequences. Further, the Company may not be able to effectively control 
their operations, and there is no assurance that the Company will be able to 
successfully meet the needs of its clients through these joint ventures.

VOLATILITY OF STOCK PRICE.  The Company's common stock has historically been 
subject to wide price fluctuations in response to a variety of factors, 
including quarterly variations in operating results, the introduction of new 
services or products by the Company, its clients or its competitors, 
announcements of acquisitions, strategic alliances and joint ventures, 
general conditions in the market research industry, and general economic and 
market conditions. Additionally, the stock market in general has experienced 
extreme price volatility in recent years. There can be no assurance that the 
price of the common stock will increase in the future or be maintained at its 
recent levels.

DEPENDENCE ON PROPRIETARY TECHNOLOGY.  The Company considers most of its 
software, database management methods, modeling techniques and other database 
information strategies to be proprietary trade secrets and relies on a 
combination of trade secret, trademark, copyright and other intellectual 
property laws, as well as contractual agreements, to protect its rights to 
such intellectual property.  However, due to the difficulty of monitoring the 
unauthorized use of and access to the Company's intellectual property, such 
measures may not provide adequate protection. In addition, there can be no 
assurance that the courts will enforce the contractual arrangements which the 
Company has entered into to protect its proprietary technology. Any 
misappropriation of the Company's intellectual property could have a material 
adverse effect on the Company's business.

RISK OF DECLINING RESPONSE RATES.  The Company's ability to provide timely 
and accurate custom market research to its clients depends on its ability to 
collect high quality data through its Consumer Mail Panel-SM- ("CMP"), its own 
broad-based panel of consumer households, random telephone interviewing, and 
other sources. Response rates in the industry, exclusive of consumer mail 
panels, have generally declined in recent years, which could result in lower 
quality data and increased project costs.  If the Company is unable to 
recruit and maintain appropriate CMP members, or if receptivity to the 
Company's questionnaires and other data collection methods by respondents 
declines, or if the Company is for any other reason unable to rely on the 
integrity of the data it receives, the Company's ability to market and sell 
its research products would be materially and adversely affected.


                                    Page 14

<PAGE>

RELIANCE ON KEY PERSONNEL.  The Company's future performance will depend to a 
significant extent upon the efforts and abilities of key personnel who have 
expertise in custom market research and have established relationships with 
the Company's key clients.  Although customer relationships are managed at 
many levels in the Company, the loss of one or more of the Company's key 
employees could have an adverse effect on the Company's relationship with one 
or more clients served by such persons. The Company's success also depends on 
its ability to hire, train and retain skilled personnel in all areas of its 
business. Competition for qualified personnel in the Company's industry is 
substantial. There can be no assurance that the Company will be able to 
recruit, retain and motivate a sufficient number of qualified personnel to 
compete successfully.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)  Exhibits.

See Index to Exhibits immediately following the signature page.

(b)  Reports on Form 8-K.

A report on Form 8-K dated March 31, 1998 was filed on April 8, 1998, 
reporting under Item 2 thereof the acquisition of Tandem Research Associates, 
Inc.

A report on Form 8-K/A dated March 31, 1998 was filed on June 11, 1998, 
amending Item 7 of the Form 8-K filed on April 8, 1998.


                                    Page 15

<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.

                                            Market Facts, Inc.
                                            ------------------
                                               (Registrant)


Date: August 3, 1998                        Timothy J. Sullivan
                                            -------------------
                                            Timothy J. Sullivan
                               Chief Financial Officer, Senior Vice President,
                                 Treasurer, Assistant Secretary and Director
                                         (Principal Financial Officer)

Date: August 3, 1998                         Anthony J. Solarz
                                             -----------------
                                             Anthony J. Solarz
                                       Vice President and Controller
                                       (Principal Accounting Officer)


                                    Page 16

<PAGE>

                               INDEX TO EXHIBITS
                                       
<TABLE>
<CAPTION>
Exhibit Number     Description
--------------     -----------
<C>                <S>
  (3)(a)           Restated Certificate of Incorporation (5), as amended. (14)

  (3)(b)           By-laws as Amended and Currently in Effect. (11)

  (4)(a)           Article Fourth of the Company's Restated Certificate of Incorporation (5), as
                    amended. (14)

  (4)(b)           Rights Agreement as Amended and Currently in Effect. (3)

  (4)(c)           Certificate of Designation, Preferences and Rights of Series B Preferred
                    Stock. (10)

  (10.1)           Term Note dated February 23, 1995 between Market Facts, Inc. and Verne
                    Churchill. (4)

  (10.2)           Term Note dated February 23, 1995 between Market Facts, Inc. and Lawrence
                    Labash. (4)

  (10.3)           Term Note dated February 23, 1995 between Market Facts, Inc. and Thomas Payne. (4)

  (10.4)           Term Note dated February 23, 1995 between Market Facts, Inc. and Glenn
                    Schmidt. (4)

  (10.5)           Term Note dated February 23, 1995 between Market Facts, Inc. and Timothy
                    Sullivan. (16)

  (10.6)           Demand Note and London Interbank Offered Rate Borrowing Agreement dated April
                    30, 1997, between the Company and American National Bank and Trust Company of
                    Chicago. (16)

  (10.7)           Mortgage and Security Agreement dated April 11, 1990 between American National
                    Bank and Trust Company as Trustee under Trust No. 110201-04 and The
                    Manufacturers Life Insurance Company together with Mortgage Note. (2)

  (10.8)           Credit Agreement dated June 7, 1996, between the Company and Harris Trust and
                    Savings Bank (6), as amended, and Revolving Credit Note dated September 4,
                    1997 relating thereto. (16)

  (10.9)           Employment Agreement with Thomas H. Payne. (13)

  (10.10)          Employment Agreement with Lawrence W. Labash. (13)

  (10.11)          Employment Agreement with Timothy J. Sullivan. (13)

  (10.12)          Employment Agreement with Sanford M. Schwartz. (17)

  (10.13)          Indemnity Agreement with Jack R. Wentworth dated July 15, 1994. (1)
                    Substantially identical agreements were also entered into with the following
                    individuals:
                    William W. Boyd        Karen E. Predow
                    Verne B. Churchill     Thomas H. Payne
                    Lawrence W. Labash     Sanford M. Schwartz

  (10.14)          Term Note dated March 29, 1996 between Market Facts, Inc. and Verne Churchill. (5)

  (10.15)          Term Note dated March 29, 1996 between Market Facts, Inc. and Thomas Payne. (5)

  (10.16)          Term Note dated March 29, 1996 between Market Facts, Inc. and Glenn Schmidt. (5)

  (10.17)          Term Note dated March 29, 1996 between Market Facts, Inc. and Lawrence Labash. (5)

  (10.18)          Term Note dated March 29, 1996 between Market Facts, Inc. and Timothy
                    Sullivan. (16)

  (10.19)          Indemnity Agreement with Timothy Sullivan dated September 3, 1997. (16)
                    Substantially identical agreements were also entered into with Ned Sherwood
                    and Jeffery Oyster.

  (10.20)          Investment Agreement dated June 6, 1996 among the Company, MFI Investors L.P.
                    and MFI Associates, Inc. (7)

  (10.21)          Financial Advisory Agreement dated June 6, 1996 between the Company and MFI
                    Investors L.P. (8)


                                    Page 17

<PAGE>

Exhibit Number     Description
--------------     -----------

  (10.22)          Convertible Note dated June 6, 1996 in the principal amount of $8,250,000
                    issued by the Company to MFI Investors L.P. (9)

  (10.23)          Market Facts, Inc. 1996 Stock Plan, as amended. (12)

  (10.24)          Stock Purchase Agreement by and among Market Facts, Inc., Kathleen Knight,
                    Robert Skolnick, Gunilla Broadbent and BAIGlobal, Inc. dated as of July 31
                    1997. (15)

  (10.25)          Employment Agreement with Kathleen Knight. (15)

  (10.26)          Employment Agreement with Robert Skolnick. (15)

  (10.27)          Employment Agreement with Gunilla Broadbent. (15)

  (10.28)          Underwriting Agreement dated October 21, 1997 by and among Market Facts, Inc.,
                    MFI Investors L.P. and the several underwriters named therein. (16)

  (10.29)          Promissory Note dated April 1, 1994 between Market Facts, Inc. and Timothy
                    Sullivan. (16)

  (10.30)          Term Note dated December 12, 1997 between Market Facts, Inc. and Sanford M.
                    Schwartz. (17)

  (10.31)          Asset Purchase Agreement by and among Market Facts, Inc. TRA Acquisition
                    Corp., Donald E. Rupnow, Daniel Fish and Tandem Research Associates, Inc.
                    dated as of March 31, 1998. (18)

  (10.32)          Termination Agreement dated June 4, 1998 between ZS Fund L.P. and the Company.

  (10.33)          Financial Advisory Agreement dated as of January 1, 1998 between ZS Fund L.P.
                    and the Company.

  (27)             Financial Data Schedule.
</TABLE>
__________________

(1)    Incorporated by reference to Registrant's Quarterly Report on Form 10-Q 
       for the quarterly period ended September 30, 1994.

(2)    Incorporated by reference to Registrant's Annual Report on Form 10-K for
       its fiscal year ended December 31, 1992.

(3)    Incorporated by reference to Registrant's Form 8-A dated July 3, 1996, 
       commission file number 0-04781.

(4)    Incorporated by reference to Registrant's Quarterly Report on Form 10-Q 
       for the quarterly period ended March 31, 1995.

(5)    Incorporated by reference to Registrant's Quarterly Report on Form 10-Q 
       for the quarterly period ended March 31, 1996.

(6)    Incorporated by reference to Exhibit No. (b) of Registrant's Schedule 
       13E-4 dated June 11, 1996, commission file number 5-20859.

(7)    Incorporated by reference to Exhibit No. (c)(1) of Registrant's Schedule 
       13E-4 dated June 11, 1996, commission file number 5-20859.

(8)    Incorporated by reference to Exhibit No. (c)(2) of Registrant's Schedule 
       13E-4 dated June 11, 1996, commission file number 5-20859.

(9)    Incorporated by reference to Exhibit No. (c)(3) of Registrant's Schedule 
       13E-4 dated June 11, 1996, commission file number 5-20859.

(10)   Incorporated by reference to Exhibit No. 99(c)(4) of Registrant's 
       Schedule 13E-4 dated June 11, 1996, commission file number 5-20859.

(11)   Incorporated by reference to Registrant's Quarterly Report on Form 10-Q 
       for the quarterly period ended June 30, 1996.

(12)   Incorporated by reference to Registrant's Form S-8 dated August _, 1998.

(13)   Incorporated by reference to Registrant's Annual Report on Form 10-K 
       for its fiscal year ended December 31, 1996.

(14)   Incorporated by reference to Registrant's Quarterly Report on Form 10-Q 
       for the quarterly period ended June 30, 1997.

(15)   Incorporated by reference to Registrant's Form 8-K dated July 31, 1997.

(16)   Incorporated by reference to Registrant's Quarterly Report on Form 10-Q 
       for the quarterly period ended September 30, 1997.

(17)   Incorporated by reference to Registrant's Annual Report on Form 10-K for 
       its fiscal year ended December 31, 1997.

(18)   Incorporated by reference to Registrant's Form 8-K dated March 31, 1998.


                                    Page 18