Mutual Agreement: the Most Closed Public Sectors (and How an SME Gets In)

When we say that 58.3% of Québec's public contracts are awarded without a call for tenders, that's an average. And like all averages, it hides enormous gaps. In some sectors, mutual agreement is the exception. In others, it's almost the absolute rule.

We took the 158,349 public contracts recorded on SEAO between 2021 and 2023, counting each contract only once per award process, and we sorted them by sector. The result leaves no doubt: your line of business determines, more than anything else, how you should approach public procurement.

Mutual agreement doesn't carry the same weight everywhere

Across all contracts, 58.3% are awarded by strict mutual agreement (direct award to a supplier). But depending on the sector, that share drops to around 10% or climbs past 90%. In other words, two Québec SMEs can live in two opposite worlds: one where almost everything plays out through public notices, the other where almost everything is decided upstream, with no notice.

The sectors most closed to competition

Here are the fields where direct award largely dominates. Each row shows the share of contracts awarded by mutual agreement and the median amount (half the contracts are below it).

Source: Adjudica analysis, SEAO open data, contracts 2021-2023.

In these sectors, watching SEAO notices shows you only a fraction of the real market. The majority of contracts are awarded to suppliers the body already knows, without going through a public notice you could spot.

The sectors most open to competition

Conversely, some fields go very largely through public calls for tenders. These are mainly construction and standardized goods.

Source: Adjudica analysis, SEAO open data, contracts 2021-2023.

Here, the public call for tenders is the normal way in. Watching the notices, reading the specifications and submitting a compliant, competitive bid are the skills that count.

Why such a gap

The logic isn't an administrative whim, it follows the nature of what's being bought.

The heavily mutual-agreement sectors are those of specialized services and goods or continuity. In health, an institution doesn't switch the supplier of a certified device without risk. In IT, replacing an installed system is expensive and carries risks, so the body often renews the existing supplier. In training or professional services, precise expertise and the relationship count more than the lowest price. These contracts are often below the public-tender thresholds, which makes mutual agreement legal and frequent.

The heavily competitive sectors are those of construction and standardized goods. A bridge, a building, a batch of materials or a vehicle can be described in a precise specification and compared on price. These contracts are also bigger (the median for a civil engineering work exceeds $500,000), so well above the thresholds that make a public call for tenders mandatory.

Contract size, the other signal

Look at the second column of the tables. The heavily mutual-agreement sectors show human-scale medians, often between $45,000 and $90,000. The competitive sectors show much higher medians, up to more than half a million in civil engineering.

What it changes for your SME

The first thing to do is locate your sector on this map. Your strategy follows from it.

If you're in a heavily mutual-agreement sector (health, professional and administrative services, IT, training, medical equipment): watching SEAO notices makes you miss the essential. Your priority is to be findable before the need exists. Concretely, sign up for the Supplier Directory on SEAO, fine-tune your UNSPSC codes so you stand out in buyers' searches, and build relationships with the purchasing officers in your region. A first small mandate, well delivered, installs you in the body's ecosystem.

If you're in a heavily competitive sector (construction, materials, vehicles, industrial equipment): the game is won on the call for tenders. Master reading the specifications, the administrative compliance that eliminates half the bids, and your bid price. Monitoring the notices and running a tight file are your best allies.

If you're in between (architecture and engineering services, maintenance and repair, environmental services, around 50 to 70% mutual agreement): you need both approaches. Being findable to capture direct awards, and knowing how to respond to a notice when it comes out.

Finding your strategy in practice

1. Identify the category or categories that match your activity in the tables above.
2. If your sector exceeds 70% mutual agreement, invest first in your visibility (Directory, codes, relationships) rather than in monitoring notices alone.
3. If your sector is below 40%, invest first in your ability to produce compliant, competitive bids.
4. In every case, look at who won past contracts in your sector on SEAO: it's the best indicator of how your market actually works.

Methodology

The figures come from SEAO's open data (OCDS format). We keep contracts awarded with a supplier and an amount greater than zero, dated between 2021 and 2023, counting each contract only once per award process (one contract equals one OCID), as in our in-depth investigation into mutual agreement. The sectors follow the category nomenclature of the Québec public procurement classification. We only show categories with at least 500 contracts over the period, for reliability. No company is named. The shares and medians in this article are displayed directly from the reference script (closed window 2021-2023), on the same corpus as the mutual-agreement investigation.

Sources

• SEAO corpus in OCDS format, extraction and processing by Adjudica, 2021-2023.
• Categorization by nature of good or service according to the Québec public procurement classification.

Find all of Adjudica's analyses and data on public procurement.