How to choose optimal archiving settings
When creating a new archive, you first need to select the archive format. ZIP is preferable only if you are not sure that a receiver of your archive has WinRAR. Otherwise it is recommended to select RAR, which supports more functions and higher compression. Read RAR versus ZIP topic for more information about archive formats.
Regardless of the archive format the next step is selection of compression method. Six compression methods are supported: "Store", "Fastest", "Fast", "Normal", "Good" and "Best". The "Best" method provides highest, but slowest compression, "Fastest" compresses poorly, but is very fast, "Store" merges files into an archive without compression. If you create an archive for distribution or for long storage, probably you should ignore time and use the "Best" compression method to reduce the size as much as possible. But if you are creating your daily backup, "Normal" compression is usually the best choice.
If you selected the ZIP archive format, your preparations are finished on this stage. RAR archives support one more important option affecting compression - solid archiving. This mode is explained in the Solid archives topic, so here only the main concept will be given. if you need to maximize compression - use solid mode, if you need to have maximum archive updating speed or if you want to minimize data losses in case of archive damage, do not use solid mode.
In some cases further fine tuning of RAR compression can be performed in Advanced compression parameters dialog, which can be accessed using "Compression…" button in "Advanced" section of Archive name and parameters dialog. But usually it is not necessary.
These are all the main settings, which affect compression ratio and speed. Actually, you do not need to set them before each archiving. Simply select your favorite default values once in the default compression profile, which can be created from Compression settings dialog and later you may change values in Archive name and parameters dialog or using command line switches, when executing WinRAR from the command line.