I use an open source compression software named Peazip running on a Intel Core i5-8250U @1.6 GHz processor. However, I have tried compressing files to 7z many times but the compression ratio is hardly less than 98%. Is it because of the processor or something else? Anyone please let me know how do I get a better compression ratio and do recommend any other alternative software that can achieve it. I have tried various compression softwares (even the official one), but the result hardly varies. If it some other issue let me know.
Your processor won’t affect the compression ratio that can be achieved, although it will affect the speed of the process. You did not specify what kind of files you are trying to compress, but the type of file makes a huge difference in the amount of compression that can be achieved. A plain text file or uncompressed image will typically have a high compression ratio. If you are trying to compress an already compressed format you will not have a good compression ratio. For example, many media files like MP3 and JPEG are already compressed. Therefore, you cannot get a much higher compression ratio if you try to compress such a file. Also some types of data do not compress as well as other types.
The short version is that trying to compress an already compressed file will never work well.