I was told the saturday market in Sapa was just a tourist attraction. I expected to find more foreigners than locals. But to my surprise, this was not the case. Of course there are tourists in the local markets, but most of the people I found were locals wearing their traditional clothes.
If you want to visit the market you have to come here on a weekend. The market is not difficult to find, just follow the people and you will get to the open air market. Once there you will see two big buildings. Inside one of them you will see plenty of souvenirs, on the second floor. In the other market you will find the local version of a mall. It is here where locals buy their clothes and appliances.
Bargaining and talking with sellers is part of the fun while in Sapa. Most of the hill tribe people I found, specially the young ones, spoke perfect English. The local's language skills were much better than in the other cities I visited in Vietnam.
Vietnam Travel - Sapa Travel Guide