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I went to site collection's site setting > term store management > but I dont see a way to create local term set group for this given site collection

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Problem solved. Just had to make sure one of option is checked via central admin for Managed Metadata service app

https://jerryyasir.wordpress.com/2012/10/10/managed-metadata-service-application-the-default-term-store-for-this-site-cannot-be-identified/

Thanks

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