Go to a bank cash machine and withdraw soles, the Peruvian currency. You can usually get the best rates from these ATM's so you can negotiate a better price at the markets. Most prices are higher if you use a credit card since the vendors are charged a credit fee for each transaction.
Travel to Avenue Ricardo Palma, 205 Miraflores to find the Inca and Indian Markets. You will find an entire street of pockets of individual markets with hundreds of discount stalls. From most areas in Miraflores, you can walk to these markets with directions from your hotel concierge or a tourist map. You can also ask for a cab which should cost you about $3.
Visit one pocket of stores to determine what items you would like to buy. From alpaca shawls to silver jewelry, price all the items you are looking to purchase and determine who has the best prices.
Return back to your favorite vendors and ask if they will give you a cash discount for paying with cash. Vendors pay a high fee for using a credit card for each transaction, so they most often will offer a 10% discount on their lowest price.
