Service Merchandise's history can be traced to 1934, to a small five-and-dime store founded by Harry and Mary Zimmerman in the town of Pulaski, Tennessee.

In the early 1980s, the Service Merchandise headquarters moved from Nashville to nearby Brentwood, Tennessee, becoming one of the first businesses to plant itself in the area that is now known as Cool Springs.

[citation needed] The company lost market share in its housewares and electronics sectors to giant discounters, such as Walmart and Bed Bath & Beyond, and later Best Buy and Circuit City.

Although Service Merchandise was early to embrace the Internet in the 1990s, generating tens of millions of dollars in sales, it was not enough to offset the damage done by the mega-chain stores springing up nationwide.

[9][10][11] While in the process of changing its retail format, a group of creditors forced an involuntary petition for bankruptcy under Chapter 11 on March 15, 1999, seeking court supervision of the company's restructuring.

The reason behind offering the catalog showroom approach to retailing was that it reduced the risk of merchandise theft, known in the industry as shrinkage, and also enabled customers to shop without the inconvenience of physically dragging purchases throughout the store.

This process was altered in the late 1980s to allow customers to place their own orders on a number of self-service computer kiosks named "Silent Sam", which the company later renamed "Service Express".

Chairman/CEO Raymond Zimmerman would appear multiple times on the yearly Jerry Lewis MDA Telethon to present donations on behalf of the company and its customers.