Secondly let them know that the product you want to buy is not perfect. For example it is in wrong colour or threads are coming out etc. In this case sales people usually will give some discount. Another thing is Chinese sellers always give higher price to foreigners so it is better for us to ask for 'onest' price at the beginning.
Finally I want to give you the most important advice. Never ever believe sales people! They will tell you anything you want to hear (including lies) just to sell the product. Salespeople can shout and even curse at you but don't give up:) Even if you will not be able to buy the thing you like at one stand you can always buy it in the next one...
At the end there is a story from the souvenir shop nearby the Shenyang Forbidden City. I was there with my husband just to have a look. I wasn't planning to buy anything but I noticed small paper fan which I liked very much. Sales people at the stand were very excited about it and they were telling me the price of it. It was 45 Yuen. I new back then that it is too much even though it is about 4.50 Euro. By the way I could buy 2 lunches for it:) Anyway I said no to that and I wanted to walk away. But the sales people didn't give up and start giving me lower prices. My husband joined me then telling them I don't want it because they don't give me the normal price but much higher. They got a little angry but at the end while we were almost walking out from the market they called us back that we can have the fan for 15 Yuen...