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They would if they're the national government, a local authority or a public body. However, since Wiggle are none of the above the public tender threshold of £250,000 (which I believe has been increased) doesn't apply to them. As a private company, they can choose whoever they like to use as a courier.
Brommers
Depends if they're sending out over £250,000 worth of shipping then they'll have to tender it, which is how such terrible contractors are acquired as cost generally outweighs service.