He knows a victory against Jupp Heynckes' team would be a huge stride towards getting through the group stages.
The England midfielder said: "Four points is a lot different to getting another draw or a defeat.
"It can shape it. But there are a lot of games in the group.
"It doesn't seem many but there are still 15 points to play for. Ten gets you qualified more often than not.
"We will just take it a game at a time. They are all tough games but we are more than ready for it."
While Bayern are Champions League regulars, Milner insists City are no rookies at this level and are packed with experience.
He added: "Luckily we have a really good squad of players who have played European or international football. That obviously helps that transition when you play against different styles.
"The majority of players have played in the Champions League before, the only new experience is doing it together."