William (Tim) Beyer has burns on his arms from 30 years of stirring and pouring the boiling sugar, cream and corn syrup that go into Velati's caramel candy, the chewy confection his family has been cooking up in downtown Washington for 116 years.

Today, Velati's, the only licensed candy manufacturing plant in Washington, produces more than 1,000 pounds of caramels a day in the fifth-floor kitchen of Woodward & Lothrop's downtown store. The candy, prepared following the secret recipe of Beyer's great-grandmother, is sold at $4.75 a pound at all Woodies stores except the Pentagon location.

This is the candy makers' busiest time of year. Holiday season sales of Velati's caramels account for almost 10 percent of the entire year's business. From Dec. 15th through Christmas Eve a five-person crew works 12 to 18 hours a day, six or seven days a week.

The 30 batches a day come in 10 varieties: soft, chewy, crumbly, chocolate, vanilla, with and without nuts and marshmallows. Velati's caramels are shipped around the world; Mrs. Woodrow Wilson and Kim Novak have been customers.

"We get people coming in with the same Christmas list every year," said Connie Klier, manager of Woodies' retail food group. Some 27,000 pounds, or 20 percent of the December business, are ordered by mail: "We just got an order from London," she said.

Chief cook Beyer said he can tell just by looking when Velati's caramel candy is ready to be poured from the huge copper kettle onto a marble slab for cooling and cutting.

The kettles, the marble table tops and the recipe date to 1866 when Velati's first opened in downtown Washington. The candy cost 40 cents a pound then, and Washington's carriage trade literally pulled up to the store at Ninth and G streets NW in horse-drawn buggies to sample the sweets.

Tim Beyer, 52, and his brother Robert, 57, who is in charge of distribution, are the only members of the Velati family still involved with the business.

The Beyers' great-grandmother, Mrs. Salvatore Velati, originally from Turin, Italy, began making the candy when the family set up its first shop in Richmond, Va. According to family history, the Velatis were forced out of Richmond in 1866 after the city was ravaged by Ulysses S. Grant's troops.

From 1866 until 1972, the store prospered at Ninth and G streets NW. But when Pauline V. Beyer, daughter of the founders, died in 1963 at age 89, the survivors decided to sell the property.

The Beyer brothers said they regretted the sale but were not involved in the decision and did not have the money to buy back the property. Despite its designation as a historic landmark, the store, built in 1911, was razed in 1973; the site is now occupied by the new YWCA building.

Velati's became a tenant of its mammoth neighbor, Woodward & Lothrop, in 1972, with a main-floor retail outlet. Two years ago, the department store bought the company from the Beyers, who continue to run the candy emporium.

James Parks, who has been cooking beside Tim Beyer for 15 years, brings his son, Donnell, in for the peak season. And Barbara McEachern, the shop's accountant for two years and a Woodies employe for 10, said she has mastered the 80-minute cooking process, except for the doneness test. That requires dipping into the kettle and dropping a wad of the sugary goo into ice water to determine whether the consistency is right. She stirs the mixture with a long wooden paddle but lets the men lift the heavy kettles.

Mainly, though, McEachern watches the books. By last week, sales were running ahead of last year's record-setting $3,000 in counter business the week before Christmas.

The caramels have a shelf life of only one week; any unsold merchandise is discarded. Klier is "trying to crack the peanut brittle code" in hopes of venturing into that longer-lasting product.

"Some people tell me they freeze it. It's addictive, though," said Tim Beyer, who started making caramels at age 20 and still eats about half a pound a day. "I love it."