Deadstock
Good ERP inventory management is good flow - and idle inventory is trash that pollutes rivers. "Slow sales" is simply a surplus of product, but it's a bigger hindrance to a well-functioning warehouse than you might think. They take up space on shelves that could be used for other products (bestsellers and new inventory), and the cost of storing them and maintaining the space they occupy is no longer worth it.
There can be a variety of reasons for this wasteful ERP overshooting, but it usually boils down to not paying close attention to how your sales are in line with forecasts. By focusing on which products aren't selling as well or as fast as expected, you can begin to develop a strategy for taking them off the shelves and reducing future orders.
Out-of-stock and late delivery
At the other end of the spectrum of ERP inventory management are out-of-stock and back deliveries - not too much inventory, but too little. This happens when businesses rely on just-in-time inventory, an inventory management philosophy that involves carrying as little excess inventory as possible. Such smart storage technology can be very efficient. However, with this method, if you underestimate demand, you also run a greater risk of being out of stock.
On the face of it, this seems like a good question. Who doesn't want such high demand that your product runs out? Backorders sometimes trigger more demand by creating a sense of scarcity and popularity (think of the overnight campers outside the Apple store when a new iPhone is released). However, they also have their own set of problems.
One of the more obvious problems that can result from persistent ERP stock shortages and back orders is lost sales. However, there are many less obvious problems. Backlogs often mean a scramble to get goods in, processed, and out of the warehouse as quickly as possible, which means putting on more staff to handle everything. Expedited shipping isn't cheap, and all of this eats into your bottom line.