Golden State Foods Corp.: food firm bids consumers a good time and great taste.

Golden State Foods Corp.

If someone at Golden State Foods Corp. puts you on telephone hold you will hear McDonald's Corp. theme music urging you to have "a good time" and "a great taste." That doesn't bother Golden State's other customers - the food processor and distributor has no others.

"We're basically a McDonald's machine," said Jim Williams, the company's president.

Life in the shadow of fast food colossus McDonald's has proved a gravy train for the Pasadena-based company responsible for procuring, preparing and delivering much of the chain's food. The company reported revenues in excess of $900 million in fiscal 1989 and expects over $1 billion in fiscal 1990.

It doesn't bother Williams that Golden State only serves McDonald's: "McDonald's is the largest restaurant chain in the world. It's been a 30-year relationship; they've given us opportunities to grow at a comfortable rate. Why would you put that at risk by approaching the next best company?"

The company, incorporated as Golden State Foods in 1969, grew out of a relationship between company founder Bill Moore and McDonald's founder Ray Kroc.

In 1962, Kroc asked Moore, who was selling select cuts of meat to restaurant and hamburger stands, to provide meat for the franchise's operations on the West Coast. The contracting out of the chain's meat supplies was consistent with McDonald's policy not to diversify vertically. In 1974, the company decided to devote itself to serving McDonald's alone.

It apparently was the right move, for as the chain grew, so did Golden State. The company now boasts eight distribution centers nationwide, two food processing plants, a dairy, a bakery and over 1,400 employees - 627 of them in Los Angeles County.

Innovation has also helped the company grow. In 1972, the company introduced what it calls "total distribution" to McDonald's. Instead of having different trucks make deliveries of different products, the company began to deliver all the product a franchise would need in a single truck.

"They were receiving 30 deliveries per week, versus two under the new system," said Tom Throm, vice president and chief accounting officer.

The company now distributes supplies to stores in Southern California, the Pacific Northwest, the Carolinas, upstate New York and northern Pennsylvania.

The company also ships products to Hong Kong, Singapore, Guam, Taiwan and Malaysia. The current number of franchises in those areas cannot support a distribution center presently, but Williams does not rule one out at a future date.

The distribution centers store bread, dairy products, frozen foods, produce, condiments and cleaning supplies. But Golden State is by no means the only company supplying or distributing food for McDonald's. There are 19 distribution centers owned by other companies throughout the United States alone. But Golden State is the single largest and most comprehensive.

"We're the only true conglomerate within the McDonald's system [of distribution and food processing]. There are a lot of specialists," said Williams.

Williams should know - he has occupied nearly every position at Golden State in his 29 years there. When he joined the company as a truck driver, there were two McDonald's.

The company's food processing centers serve a larger area, covering most of the western states, most of the South, upstate New York and Pennsylvania, and Ohio. The centers - in the City of Industry and Conyers, Ga., as well as a dairy plant in Pasadena, and a bakery in Greensboro, N.C. - supply more than 960 million hamburger patties per year, 20 million buns and 40 million gallons of syrups, sauces and condiments. About the only items Golden State doesn't make for the chain are french fries, pies and shortening.

Being the supplier for McDonald's isn't always easy. "The unique part of McDonald's is their high standard of quality," Williams said. "We adhere to higher standards than does the industry. Our goal is to be viewed as the best in the system."

In order to meet the McDonald's' quality testing, Golden State has installed testing equipment, identical to that used by McDonald's, at the company's two processing centers.

The company has expanded its product line by demonstrating its capacity to produce products without a commitment from McDonald's, such as when it began producing sauces, ketchup and topping in 1970.

"Anybody in the business has to take the initiative," Williams said. "We try to be aware of their needs. You see things they're thinking about and then we put our heads together and ask whether we can bring anything to that game."

McDonald's also tells the company who it should buy its raw materials from and has access to Golden State's financial records.

Sometimes McDonald's high standards are hard to meet. Last year, a drought led to a decline in the quality of tomato paste. The company responded by importing tomato paste, which still didn't meet McDonald's specifications, Throm said. Meeting such standards, and standards of efficiency in delivery, is the closest thing the company has to competition, Williams said. "You're competing against yourself," he said. "The day we're not seen as an efficient operator, we're out of business; they'll replace us."

Far from being replaced, the company plans to continue expanding through increased shipping and a wider product line, although Williams refused to cite which areas and products would see such growth.

The company has had setbacks, though. Perhaps most notable was being passed over by McDonald's to handle the chain's total distribution operations in Northern California in the company's earlier days [Martin-Brower Co. received the contract].

Innovations in processing, packaging and distribution are constantly improving the quality of product which is delivered, Williams said. "Every product on the menu is better than it was a year ago," he said, adding that recent packaging advances have led to higher taste levels.

Yet despite technological advances, Williams said doing simple things well is the key. "This is a business of basics," he said. "Each thing you do has to be done properly."

PHOTO : Jim Williams: Serving millions of meals

PHOTO : Making a break: Golden State services a local McDonald's

PHOTO : Condiments: Coming off the line