Now, if we want to talk about % difference, we will need a difference or two numbers that aren't the same. Take the numbers 15 and 25 as an example; the difference between them is 10. So now we must convert 10 to a percentage.

We will need to represent the absolute difference as a percentage by dividing it by the average of those two integers. The following is the computation method:

  • Determine the absolute difference between two numbers: 15 – 25 = -10
  • Take the average of those two figures: (15 + 25)/ 2 = 20
  • Calculate the difference by dividing it by the average: 10/20 = 0.5
  • Transform this decimal number form into percentages. 0.5 x 100= 50 which is 50 %.


That is how you calculate the percentage difference. Therefore, the percentage difference formula can be derived from these equations.

The formula we employ to arrive at this value is as follows:


Percent difference formula

Formula: ( | V1 - V2 | / (( V1 + V2 ) / 2) ) x 100    copy

Excel/ Spreadsheet Formula

=(|cell1-cell2|/((cell1+cell2)/2))*100

   copy

Steps:
  1. Replace cell1 with the initial value or Value 1
  2. And cell2 with the final value or Value 2


Example:
Let's look at a few scenarios when discussing percentage differences is important.

Assume you wish to compare the size of two businesses in terms of employees. In this case, firm A employs 80 people, but company B employs 120. The percentage difference is a useful way to compare the size differences between these two organizations.

Now calculate the percentage difference here:
- 100 x |80-120| / ((80+120) / 2) = 100 x 40 / 100 = 40 which means 40%.



When Is It Appropriate to Use It?


When both values to be used in the formula refer to the same thing, the percentage difference will be used (for example, the weights of two people).
However, we should utilize Percentage Change if there is a difference between the old and new values.

Alternatively, we should utilize Percentage Error if there is a difference between an approximate and an exact result.