This also means that if she charges per serving, she'll need to bill the client for 56 servings. (18 servings in 7" and 38 servings in 10")

Just to clarify:
"Servings" are used in two ways--- 1) to determine cost and 2) to determine amount of cake to serve to guests.

1) Cost is based on the standard of 8 cubic inches of cake. This is the same as a Wilton wedding slice of 1" x 2" x 4". Or, for a sheet cake, 2 x 2 x 2. This cost does not change, no matter how much or how big a piece of cake the customer's guests desire.

This decision of cost per serving is determined by the caker. Some cakers may charge according to the size of the tier, without mentioning servings, but cost-per-serving is often how customers compare different cakers.

2) Size of pieces of cake to serve guests depends on who is cutting or eating the cake. This decision of how much cake to serve is determined by the customer.

To take an example to the extreme, one could cut a 10" tier into 2 Jethro-sized servings. However, the caker still charges for a 38 serving cake. If one's pricing is (just as an example) $3/ serving, will you bill the customer $6 or $114? If one uses an Earlene or Wilton Party chart, it's the same, just a smaller difference.

The problem comes about when cakers start to confuse 1) and 2) and begin to adjust 1), depending on 2).

The most appropriate size of a piece of cake to serve guests is subjective, and only the customer knows how much cake their guests will want. We have to educate them about the difference between our pricing and their size of a piece.

It's probably best to say something like: "You have a couple options. I could make a 7" & 9" which would give you 50 servings, and would cost $150. However, the cake industry pricing is based on a standard serving size that's about the size of a folded-over peanut butter sandwich [IndyDebi reference]. If you want to cut and serve larger pieces than that, I recommend that you consider an 8" & 10", which has 62 standard servings, and would cost $186. Which one would you like?"

Some cakers here have styrofoam, wood, or cardboard models of different-sized cake slices to show to customers, so they can visualize.

An alternative to thinking about this issue in terms of 2 decisions is to simply price your piece of cake higher. For instance, if you always follow Earlene's chart, your price per slice will be higher. The disadvantage to that strategy is that customers don't often know (or care) about the differences between Wilton wedding, Earlene, or party servings. Customers will compare your price per serving (say, an Earlene serving, which is $3.20, as a random example) with other cakers' prices based on the standard Wilton wedding slice serving of $3. They may think you are more expensive.

A final problem can come when the person cutting the cake doesn't know how big the customer wanted the servings. That's where cutting guides, taped to your cake box really help. Most every venue or caterer knows the standard Wilton wedding slice size, so that's how they'll cut it, unless instructed differently.

I know this is a LONG email. However, this issue comes up in a thread every other day, and cakers still have problems.

Just to clarify: LisaPeps is using the "party-sized" serving charts, and I use the standard wedding-sized charts. That's why we are citing different numbers of servings.

Note: If we both charge $3 per serving, who will make more money?

I posted this in reference to the previous poster mentioning the difference in party sized servings. It's up to the caker whether they have different sizes for party vs wedding, that's why I linked to the servings calculator website too. In the UK we charge by the size of cake not the number of servings.